HARRELL, J.
These combined cases
We conclude that, under the Social Security Act and the Family Law Article of the Maryland Code, a local department of social services, acting in the capacity as an institutional representative payee appointed by the Commissioner of the Social Security Administration, has discretion to apply a CINA foster child's OASDI benefits to reimburse the Department for its costs incurred for the child's current maintenance, but must provide notice to the child and/or his or her legal representative that the Department applied to the SSA and received such benefits on the child's behalf. Thus, we shall affirm in part and reverse in part the judgment of the Court of Special Appeals in No. 95 and reverse that court's judgment in No. 101.
In 1939, Congress added OASDI to the Social Security Act, 42 U.S.C. § 401 et seq., which provides for, among other things, monthly benefit payments to certain members of a deceased wage-earner's family. Astrue v. Capato ex rel. B.N.C., ___ U.S. ___, ___, 132 S.Ct. 2021, 2027, 182 L.Ed.2d 887, 895 (2012). A dependent child who survives his wage-earning parent may be entitled to receive survivor's benefits if the child is unmarried and under the age of 18 (or 19 if attending school full time). 42 U.S.C. § 402(d). "An applicant qualifies for such benefits if [he or] she meets the Act's definition of `child,' is unmarried, is below specified age limits (18 or 19) or is under a disability which began prior to age 22, and was dependent on the insured at the time of the insured's death." Astrue, ___ U.S. ___, ___, 132 S.Ct. at 2027, 182 L.Ed.2d at 895 (citing 42 U.S.C. § 402(d)(1)). The wages earned by the deceased parent prior to his or her death determine the amount of the benefit. Id.
A representative payee may be appointed for a child entitled to OASDI benefits if the Commissioner of the SSA determines that the interests of the beneficiary will be served by doing so. 42 U.S.C. § 405(j)(1)(A). "[E]very beneficiary has the right to manage his or her own benefits. However, some beneficiaries due to a mental or physical condition or due to their youth may be unable to do so." 20 C.F.R. § 404.2001(b)(1) (emphasis added). Generally, a representative payee is appointed for child beneficiaries under the age of 18, unless the child "shows the ability to manage the benefits."
20 C.F.R. § 404.2020(a)-(e). The SSA prioritizes also categories of persons or entities whom the Administration prefers to appoint as a child's representative payee:
20 C.F.R. § 404.2021(c) (emphasis added).
The SSA provides beneficiaries with written notice that the Administration will appoint a representative payee before the payee is appointed officially, 20 C.F.R. § 404.2030(a), and before certifying payment to the payee. 42 U.S.C. § 405(j)(2)(E)(ii). If the beneficiary is "under age 15, an unemancipated minor under the age of 18, or legally incompetent, [the] written notice goes to [the beneficiary's] legal guardian or legal representative." 42 U.S.C. § 405(j)(2)(E)(ii); 20 C.F.R. § 404.2030(a).
The notice required by statute must include language explaining a beneficiary's right to appeal the appointment of a particular entity as the representative payee. 42 U.S.C. § 405(j)(2)(E)(ii); 20 C.F.R. § 404.2030(a). SSA regulations explicitly provide for both administrative and judicial review of, among other things, "initial determinations" made by the agency. 20 C.F.R. § 404.902. "Initial determinations" are defined by regulation (somewhat circularly) as decisions made by the SSA which are subject to administrative and judicial review. 20 C.F.R. § 404.902. The SSA's decision of who will serve as an OASDI beneficiary's representative payee is listed as an example of an "initial determination" and is thus subject to both administrative and judicial review. 20 C.F.R. § 404.902(q).
Once appointed, a representative payee is required to use the benefit payments solely for the beneficiary's "use and benefit in a manner and for the purposes [the representative payee] determines ... to be in [the beneficiary's] best interests." 20 C.F.R. § 404.2035(a). The SSA views costs associated with the beneficiary's "current maintenance" to be valid expenditures satisfying the requirement that benefit
The Family Law Article of the Maryland Code mandates that the Department of Human Resources ("DHR") provide "child welfare services" to foster children. Md. Code (1984, 2006 Repl. Vol.), Fam. Law § 5-524. When a foster child is unable to return to his parent or guardian, DHR must "develop and implement an alternative permanent plan for the child." Id. at § 5-524(3).
As a last resort, the Department will commit a child to foster care when no other placements are viable, for which the Department is required to pay for the services a foster care placement provides. Md. Code (1984, 2006 Repl. Vol.), Fam. Law § 5-526(a)(1) ("The Department shall provide for the care, diagnosis, training, education, and rehabilitation of children by placing them in group homes and institutions that are operated by for-profit or nonprofit charitable corporations."). The Department is required to reimburse these charitable corporations for the costs of services provided to the foster children at a rate set by the Department and in line with the State budget. Id. at § 5-526(b)(1).
All of a child's resources, including "survivor's disability insurance," are subject to allocation by the Department to reimburse itself for the "cost of care" of a foster child in an out-of-home placement. COMAR 07.02.11.29(A), (K)(1). Subsection (K)(1) of this regulation identifies explicitly "survivor's disability insurance" as an example of resources that may be tapped by the Department for self-reimbursement. Foster children over the age of 18 in an out-of-home placement, if entitled to survivor's disability benefits, may elect either to receive the payments themselves and then reimburse the Department, or to have the Department appointed as the child's representative payee for the benefits (assuming that the SSA has made a determination that the Department is the appropriate representative payee for the child). Id. at (K)(2).
The Department may use the child's resources subject to the following priorities: first, for the "cost of care;"
The Circuit Court for Baltimore City, sitting as the juvenile court, determined that Ryan W. was a CINA on 4 June 2002 when he was nine years old. The Courts and Judicial Proceedings Article ("CJP") of the Maryland Code, § 3-801 et seq., provides the framework for determining whether a child is a CINA. When the Department learns that a child is being abused or neglected, or suffers from a developmental disability or mental disorder, and is not receiving proper care and attention to his or her needs, the particular locality's Department of Social Services may file a petition seeking a determination by the respective juvenile court that the child is a CINA. Md. Code (2001, 2006 Repl. Vol.) CJP §§ 3-801(f), 3-809(a). Once a petition is filed, the juvenile court must hold an adjudicatory hearing to determine if the facts alleged can be proven. Md. Code (2001, 2006 Repl. Vol.) CJP §§ 3-801(c), 3-817(a) and (c). If the allegations are proven to the satisfaction of the juvenile court, the court must determine whether the child needs assistance and how the court should intervene "to protect the child's health, safety, and well-being." Md. Code (2001, 2006 Repl. Vol.) CJP §§ 3-801(m), 3-819(a)(1). If the court determines the child is in need of assistance, it may commit, among other things, the child to the custody of the Department. CJP § 3-819(b)(1)(iii). The Department must establish then an out-of-home placement for the CINA in foster, kinship, group, or residential treatment care. Md. Code (1984, 2012 Repl. Vol.)
Here, the Department filed a petition with the Circuit Court for Baltimore City on 23 January 2002, seeking a determination that Ryan was a CINA. As a basis for the determination sought, the Department cited Ryan's mother's drug abuse and his father's alcohol abuse, their failure to provide adequate food and clothing for their children, their lack of supervision, and their failure to ensure the children attended medical appointments and school on time. Following a hearing, Ryan was placed in emergency shelter care by order dated 13 February 2002, and was determined on 4 June 2002 to be a CINA and committed to the custody of the Department. As noted previously, Ryan was nine years old at that time.
Subsequent to his commitment to the Department's custody, Ryan was placed in various group homes and non-relative foster homes. The Department paid the cost of his care. Ryan's mother died in August
A beneficiary child is entitled to OASDI benefits for each parent that dies. Here, Ryan was entitled to benefits from both his mother and father. The Department received two lump sum payments for OASDI benefits covering the interim between the deaths of Ryans' parents and the filing of the application. The Department received the first of these payments on 13 November 2009, in the amount of $8,481, which covered the benefits accrued between Ryan's father's death and the start of benefit payments (November 2008 to November 2009), and represents the benefits to which Ryan was entitled from his father's wages. The second lump sum payment, in the amount of $11,647.50, was received on 15 December 2009, and covered the period August 2006 to November 2008, representing the benefits to which Ryan was entitled based on his mother's wage earnings. From December 2009 until February 2011, when Ryan turned 18, the Department received a monthly $771 OASDI benefit payment on Ryan's behalf. Ultimately, as of the time of trial in this case, the Department received a total of $31,693.50 in its capacity as Ryan's representative payee for OASDI benefits and used the entire amount to reimburse itself for some of the costs of Ryan's foster care.
Ryan W., through counsel, filed, on 5 April 2011, with the juvenile court a "motion to control conduct," alleging that the Department, as Ryan W.'s representative payee, applied for and received his OASDI benefits without notifying the child or his CINA attorney and misused the funds in violation of its statutory and fiduciary duties. Specifically, Ryan contended that the Department allocated improperly his benefits to reimburse itself for the costs of his foster care, without an individualized determination as to what other use of the funds might be in his best interests. See 42 U.S.C. 405(j)(1)(A) (mandating that representative payees apply benefits to the best interests of the beneficiary); see also 42 U.S.C. 405(j)(2)(C)(v)(III) (providing that representative payees are fiduciaries of the beneficiary).
A panel of the Court of Special Appeals ("COSA") reversed the juvenile court's order in part, concluding that the juvenile court lacked jurisdiction to order the creation of a constructive trust, although maintaining that the Department reimburse Ryan W. in the amount of $8,075.32 for benefits received on his behalf during a period in which the Department incurred lower costs for his care. In re Ryan W., No. 1503, 2012 WL 3847359 (Md.Ct.Spec. App. Sept. 5, 2012); superseded on reconsideration by 207 Md.App. 698, 56 A.3d 250 (2012).
The Department filed a motion for reconsideration, asking the COSA to correct the amount ordered reimbursed and, alternatively, to hold that the COSA's rationale that "the Juvenile Court is not ... vested with broad equitable powers to supervise the Department when it is acting in its role as representative payee for foster children committed to its care" barred any order for reimbursement of the funds. While that motion was pending, counsel for Ryan W. filed a petition for writ of certiorari with this Court, seeking review of the original COSA decision. On 21 November 2012, the COSA issued a reported opinion on reconsideration reiterating its view that the juvenile court acted outside its authority in establishing a trust, but reducing the amount to be reimbursed to Ryan from $8,075.32 to $660.
We granted the parties' petitions for writs of certiorari. In re Ryan W., 429 Md. 528, 56 A.3d 1241 (2012); In re Ryan W., 430 Md. 11, 59 A.3d 506 (2013). The questions presented for our consideration are:
We review the juvenile court's findings of fact in CINA proceedings under the "clearly erroneous standard." In re Shirley B., 419 Md. 1, 19, 18 A.3d 40, 53 (2011) (citations omitted). Therefore, the juvenile court's factual findings will not be disturbed "[i]f any competent material evidence exists in support of the trial court's factual findings...." Figgins v. Cochrane, 403 Md. 392, 409, 942 A.2d 736, 746 (2008). The juvenile court's conclusions of law are reviewed without deference. In re Adoption/Guardianship of Amber R., 417 Md. 701, 708, 12 A.3d 130, 134 (2011). Errors of law are generally remanded to the trial court for further proceedings, unless the error is harmless. In re Shirley B., 419 Md. at 19, 18 A.3d at 53. Only where we find a "clear abuse of discretion" will we disturb a lower court's legally sound decision that is based upon factual findings that are not "clearly erroneous." In re Shirley B., 419 Md. at 19, 18 A.3d at 53.
Ryan asks this Court to reverse the COSA's determination that a local department of social services possesses plenary authority to apply for and use a foster child's OASDI benefits, without seeking an express grant of authority from the juvenile court to exercise control over the benefits. He asks further that we hold that a local department must provide a foster child with notice and an opportunity to be heard before using a child's survivor's benefits. Although we agree with the COSA that a local department of social services need not seek permission from a juvenile court in order to exercise its statutory and regulatory-guided discretion as a duly appointed representative payee in its use of a foster child's OASDI benefits, we agree with Ryan W. that due process requires that notice be afforded at least to a CINA's attorney when the Department applies to become a payee and as benefits are received.
The Department argues that, because federal law governs the appointment of representative payees and the allocation of OASDI benefits, see 42 U.S.C. 405(j), the juvenile court is without authority to direct an approved representative payee how to allocate a child's benefits. According to the Department, the proper forum for any available remedy for Ryan's claim lies in the federal administrative and judicial review process. Ryan counters that the juvenile court is a "court of competent jurisdiction" to review SSA determinations. See 42 U.S.C. 405(j)(1)(A) ("If the Commissioner ... or a court of competent jurisdiction determines that a representative payee has misused any individual's benefit ... the Commissioner of Social Security shall promptly revoke certification for payment of benefits to such representative payee ... and certify payment to an alternative representative payee or, if the interest of the individual would be served thereby, to the individual."). We conclude that the juvenile court here did not have jurisdiction over the disputes between Ryan and his representative payee regarding the application of his OASDI benefit payments. Rather, such disputes are for resolution within the federal administrative process and subject to further federal judicial review.
We look first to the Supremacy Clause of the United States Constitution to determine if state courts may exercise jurisdiction over this dispute, outside of the statutorily-prescribed administrative process for reviewing SSA determinations. "When Congress is silent concerning [concurrent] state court jurisdiction over federal causes of action, there is a `deeply rooted presumption in favor of concurrent state court jurisdiction.'" R.A. Ponte Architects, Ltd. v. Investors' Alert, Inc., 382 Md. 689, 715, 857 A.2d 1, 16 (2004) (quoting Tafflin v. Levitt, 493 U.S. 455, 459, 110 S.Ct. 792, 795, 107 L.Ed.2d 887, 894 (1990)). This presumption, however, "can be rebutted by an explicit statutory directive, by unmistakable implication from legislative history, or by a clear incompatibility between state-court jurisdiction and federal interests." Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 478, 101 S.Ct. 2870, 2875, 69 L.Ed.2d 784 (1981). The Social Security Act provides explicitly that an individual seeking review of a decision
42 U.S.C. § 405(g) (emphasis added). Thus, while Congress was silent as to whether state courts have jurisdiction to review SSA determinations, it directs explicitly that federal courts have jurisdiction over civil actions seeking review of the Commissioner's determinations. The statutory language is expressed in mandatory terms that all such actions be brought in a federal district court.
Generally, federal law governs representative payees and their use of a child beneficiary's OASDI benefits. See 42 U.S.C. 405(j); 20 C.F.R. § 404.2001. Once appointed, a representative payee is required to use the benefit payments solely for the beneficiary's "use and benefit in a manner and for the purposes [the representative payee] determines ... to be in [the beneficiary's] best interests." 20 C.F.R. § 404.2035(a). The SSA considers costs associated with the beneficiary's "current maintenance" to be valid expenditures satisfying the requirement that benefit payments be applied "for the use and benefit" of the beneficiary and in line with his or her "best interests." 20 C.F.R. § 404.2040(a)(1). "Current maintenance includes cost[s] incurred in obtaining food, shelter, clothing, medical care, and personal comfort items." 20 C.F.R. § 404.2040(a)(1). For beneficiaries receiving institutional care because of a physical or mental disability, the definition of "current maintenance" is expanded to include "the customary charges made by the institution, as well as expenditures for those items which will aid in the beneficiary's recovery or release from the institution or expenses for personal needs which will improve the beneficiary's conditions while in the institution." 20 C.F.R. § 404.2040(b) (emphasis added). The SSA Commissioner is responsible for promulgating rules and regulations for implementing and executing the provisions of the Social Security Act, in addition to monitoring
If a child beneficiary suspects misuse of his or her OASDI benefits by his or her representative payee, the Social Security Act, as amended in 2004, provides the beneficiary with avenues for federal administrative and judicial review. The 2004 amendments include more stringent monitoring of institutional representative payees' use of benefits, as well as broader avenues in which to seek remedy for misuse of benefits by such institutional payees. See Social Security Protection Act of 2004, Pub.L. No. 108-203, 118 Stat. 493, 493 (2004). The amendment, as enacted, defines "misuse" as occurring in any case in which the representative payee "receives payment under this title for the use and benefit of another person and converts such payment, or any part thereof, to a use other than for the use and benefit of such other person." Id. at sec. 101(a)(2), § 405(j), 118 Stat. at 495 (codified at 42 U.S.C. § 405(j)(9)).
If a beneficiary is not satisfied with an initial determination made by the Commissioner as to either misuse, eligibility for benefits, or the appointment of a representative payee, the first step in the SSA's internal review process is reconsideration. 20 C.F.R. § 404.907. The SSA provides written notice to all parties of its reconsidered determination, and that decision is appealable to an administrative law judge ("ALJ"). Id.; 20 C.F.R. § 404.922. The decision of the ALJ is binding unless one of the parties requests and receives review of the decision by the Appeals Council. 20 C.F.R. §§ 404.967, 404.955(a). The decision of the Appeals Council is reviewable in federal district court, and if the Council declines to review a case, the ALJ's decision is likewise reviewable in a federal district court. 20 C.F.R. § 404.981.
Notwithstanding these provisions, Ryan contends that the juvenile court had subject matter jurisdiction over the Department's allocation of his OASDI benefits pursuant to the COSA's 2001 decision in Ecolono v. Division of Reimbursements of Department of Health and Mental Hygiene, 137 Md.App. 639, 769 A.2d 296 (2001). In Ecolono, the COSA determined that it had "subject matter jurisdiction to decide a dispute between the beneficiary of social security benefits and his representative payee with respect to the allocation of those benefits." 137 Md.App. 639, 654, 769 A.2d 296, 305. At the time Ecolono was decided, the Social Security Act and implementing regulations required only that the SSA provide restitution to a beneficiary for payee misuse if the SSA had been negligent in appointing that payee, or if the SSA recovered the misused funds from the payee. See Social Security Protection Act of 2004, Pub.L. No. 108-203, 118 Stat. 493, 493 (2004).
The appellee in Ecolono argued that, because there was an administrative review process for appointment of representative payees and a remedy for their breach of duty, state courts were without jurisdiction to interfere with a representative payee's allocation of social security benefits. COSA rejected this argument, reasoning that "nothing in federal law ... indicate[s] an intent by Congress to limit interested parties to the federal administrative and judicial review process and to prohibit State courts from exercising jurisdiction... when the relief requested is not the removal of the payee but a reallocation
Because the 2004 amendments to the Social Security Act enhanced the monitoring of institutional representative payees and made available federal remedies for misuse of benefits, the rationale underlying the result in Ecolono and cases from other jurisdictions which held that state courts possessed subject matter jurisdiction over disputes regarding the allocation of benefits by representative payees no longer exists. The appropriate forum for seeking review of disputes regarding SSA matters lies within the federal administrative and court systems. Accordingly, the juvenile court erred in directing the Department to establish a constructive trust on Ryan's behalf for funds it had received on his behalf. Having determined that the exercise of discretion by a representative payee in its use of a beneficiary's OASDI benefits is reviewable only in the federal administrative and judicial processes described in the applicable federal statute and regulations discussed supra, we hold that a state court does not have jurisdiction to direct a representative payee to allocate funds in a way that, while permitted under federal law, conflicts directly with a valid exercise of the payee's discretion under the federal law.
Ryan argues that the juvenile court, in directing the Department to conserve benefits received already and spent on his behalf, acted within its statutory authority over children deemed CINA and the Department as their fiduciary. CJP § 3-802(c) (providing that "the court may direct the local department to provide services to a child, the child's family, or the child's caregiver to the extent that the local department is authorized under State law"); see also CJP § 3-823(e) (providing for the juvenile court's authority over the child's permanency plan, including transition needs); accord In re Damon M., 362 Md. 429, 436, 765 A.2d 624, 627-28 (2001) ("Services to be provided by the local social service department and commitments that must be made by the parents and children are determined by the permanency plan.") Ryan contends further that, because CJP § 3-821 permits the juvenile court to "direct, restrain, or control" the conduct of a person or entity whenever the court finds that such conduct is not in the child's best interests, the court acted within its statutory authority. The Department contends that the juvenile court misinterpreted its authority to "control the conduct" of a party, and, alternatively, that
As a court of limited jurisdiction, the juvenile court may exercise only those powers granted to it by statute. In re Franklin P., 366 Md. 306, 334, 783 A.2d 673, 689 (2001) ("[W]hen a court proceeds by way of a special statute rather than under its general common-law authority, that court has only the powers given to it under the special statute."); see also Smith v. State, 399 Md. 565, 574, 924 A.2d 1175, 1180 (2007). Pursuant to the Courts and Judicial Proceedings Article of the Maryland Code, the juvenile court possesses exclusive original jurisdiction over CINA petitions, CJP § 3-803(a)(2), as well as concurrent jurisdiction over the "[c]ustody, visitation, support, and paternity of a child whom the court finds to be a CINA." CJP § 3-803(b)(1)(i).
The Courts and Judicial Proceedings Article does not provide explicitly that the juvenile court has jurisdiction to consider disputes in the allocation of federal OASDI funds as to CINA persons. In support of his position, Ryan argues that the juvenile court's jurisdiction over the Department's use of benefits derives from the court's powers over the "support" of a CINA. See CJP § 3-803(b)(1)(i); see also CJP § 3-819(c)(2) (providing the juvenile court with powers to determine custody, visitation, support or paternity of a CINA). He contends that, because OASDI benefits are meant to replace the "support" a child loses from his wage-earning parent(s) when the parent(s) die, O'Brien v. O'Brien, 136 Md.App. 497, 510 n. 5, 766 A.2d 211, 218 n. 5 (2001), the juvenile court's power to determine support of a CINA allows it to "make orders regarding support" of a CINA.
In construing whether the term "support," as used in CJP § 3-819, includes federal survivor's benefits, we must consider the use of the word in the context of the entire CINA statute and the word's "ordinary meaning, absent indications of a contrary intent by the Legislature." In re Roger S., 338 Md. 385, 391, 658 A.2d 696, 699 (1995) (internal citations omitted); See also City of Baltimore Dev. Corp. v. Carmel Realty Associates, 395 Md. 299, 318, 910 A.2d 406, 417-18 (2006) ("The plain language of a provision is not interpreted in isolation. Rather, we analyze the statutory scheme as a whole and attempt to harmonize provisions dealing with the same subject so that each may be given effect.").
We have held consistently that the CJP uses the term "support," in regard to CINAs, synonymously with "child support," or the parental obligation to support a child financially. Although CJP § 3-819(c)(2) permits the juvenile court to determine support, subsection (1) of § 3-819 provides that the court may order parents to "pay a sum in the amount the court directs to cover wholly or partly the support of the child." CJP § 3-819(l); see also Md. Code (1984, 2006 Repl. Vol.) Fam. Law § 5-203(b) (providing that "the parents of a minor child ... are responsible... for the child's support"). Cases involving the "support" of CINA children also illuminate the plain meaning of the term as parental obligations to support their minor child. See, e.g., Rosemann v. Salsbury, Clements, Bekman, Marder & Adkins, LLC, 412 Md. 308, 319-20, 987 A.2d 48 (2010); In re Katherine C., 390 Md. 554, 566-67, 890 A.2d 295 (2006); In re Joshua W., 94 Md.App. 486, 494-95, 617 A.2d 1154 (1993). Because the Department was not collecting or applying for "child support" from the Social Security Administration, we find no merit in Ryan's "support" argument.
Courts & Judicial Proceedings Article § 3-821 also does not provide authority for the juvenile court to act as it did here.
The Department, in No. 101, contends that the COSA erred in directing the juvenile court, upon remand, to order that $660 be returned to Ryan because of an error in the Department's accounting for the costs of foster care in May 2010.
Ryan W. contends that COMAR 07.02.11.29(K) and (L) are invalid because they require "automatic, non-discretion[ary] taking of OASDI benefits without considering transition needs, among others." Specifically, he argues that, because the federal statute and accompanying regulations require that funds be spent in accordance with a beneficiary's "best interests," automatic application of a foster child's benefits to the costs of care violates federal law. In riposte, the Department contends that the COMAR regulations are in accordance with federal law regarding a representative payee's allocation of benefits because the uses of the benefits prescribed in the COMAR sections are permitted
SSA regulations mandate that all representative payees use the OASDI benefits they receive "in a manner and for the purposes he or she determines, under the guidelines in [subpart U of 20 C.F.R. § 404] to be in [the beneficiary's] best interests." 20 C.F.R. § 404.2035(a) (emphasis added). Costs of a beneficiary's "current maintenance," which includes "food, shelter, clothing, medical care, and personal comfort items," are considered by the SSA to be appropriate uses of benefit funds. See 20 C.F.R. § 404.2040(a)(1). Additionally, institutional payees are permitted explicitly to use a beneficiary's OASDI benefits for "the customary charges made by the institution, as well as expenditures for those items which will aid in the beneficiary's recovery or release from the institution or expenses for personal needs which will improve the beneficiary's conditions while in the institution." 20 C.F.R. § 404.2040(b). The Department was duly appointed as representative payee by the SSA to receive OASDI benefit payments on Ryan's behalf, and thus was obliged to use the benefits according to federal regulations.
Ryan argues that Maryland regulations, in requiring automatic allocation of funds, are inconsistent with the discretionary nature of the allocation provisions in federal regulations. COMAR 07.02.11.29(K) provides:
COMAR 07.02.11.29(L) provides:
In Conaway v. Social Services Administration, 298 Md. 639, 471 A.2d 1058 (1984), we considered whether a representative payee could allocate a beneficiary's benefits towards the cost of caring for the beneficiary. We determined that reimbursement for the costs of providing foster care achieved by applying "current benefits to the current costs of care" was an appropriate use of federal benefits by a duly appointed representative payee. Conaway, 298 Md. at 648-49, 471 A.2d at 1063. We addressed specifically the legitimacy of COMAR 07.02.11.29(L), which was denominated as COMAR 07.02.11.07 at the operative time in Conaway:
Id. at 644, 471 A.2d at 1060.
In the present case, the juvenile court declared that subsections (K) and (L) of COMAR 07.02.11.29 were invalid because of the conflict with federal law providing for discretion to a representative payee in allocating a beneficiary's OASDI benefits. See 20 C.F.R. § 404.2035(a). The Department applied for Ryan's OASDI benefits on his behalf as representative payee and used the benefits, pursuant to this state regulation (and allowed by the federal statutes and regulations) to reimburse itself partially for the expenses it incurred for Ryan's foster care. This practice is consistent with federal law, which allows "current maintenance" and "customary charges" as appropriate expenditures by institutional payees. We agree with the COSA that the other contested provision, COMAR 07.02.11.29(K)(2), "was not implicated in Ryan's case as he was under 18 [years old] when the Department became his representative payee and, in any event, during proceedings before the Juvenile Court, a Department witness testified that the regulation is not enforced." In re Ryan W., 207 Md.App. at 748, 56 A.3d at 280.
Ryan asks us to overturn the COSA's holding that the Department's failure to provide notice or an opportunity to be heard did not violate his due process rights. He argues that the notice required to be given by the Commissioner is insufficient because, as the federal regulations applied to Ryan's situation, notice that the Department would become his representative payee was provided only to the Department as his legal guardian. Ryan contends that the Department's fiduciary obligations require it to notify a child or his or her counsel upon receipt of benefits.
The Fourteenth Amendment of the U.S. Constitution, as well as Article 24 of the Maryland Declaration of Rights (usually read in pari materia with the federal analogue), prohibits the deprivation of life, liberty, or property without due process of law. Roberts v. Total Health Care, Inc., 349 Md. 499, 509, 709 A.2d 142, 146-47 (1998) ("At the core of due process is the right to notice and a meaningful opportunity to be heard.") (internal citations omitted). Prior to considering whether an individual's right to due process was violated, we must determine first that "(1) State action has been employed
In determining what process is due, this Court will balance both the government interests and the private interests affected. Id. (citing Department of Transportation v. Armacost, 299 Md. 392, 416-20, 474 A.2d 191, 203-05 (1984)). The U.S. Supreme Court outlined three factors that courts should weigh in determining the process due in a given situation under the Fourteenth Amendment:
Mathews v. Eldridge, 424 U.S. 319, 335, 96 S.Ct. 893, 903, 47 L.Ed.2d 18, 33 (1976).
The Washington Supreme Court, in Guardianship Estate of Keffeler ex rel. Pierce v. State, 151 Wn.2d 331, 88 P.3d 949, 956 (2004) ("Keffeler III"),
We disagree with the conclusions of the Washington Supreme Court in analyzing the Mathews factors, as applied to the facts of the present case. See Keffeler III, 151 Wn.2d 331, 345, 88 P.3d 949, 956 (finding that the Commissioner's notice was sufficient because there was only a minimum risk that childrens' interest in their benefit payments would be erroneously deprived, and because the state's interests in administrative efficiency outweighed the interests of the foster children in their benefits). The private interest at stake here is Ryan W.'s interest in the "free use of his social security benefits." See McGrath v. Weinberger, 541 F.2d 249, 253-54 (10th Cir.1976). The notice provided by the Commissioner, pursuant to 42 U.S.C. § 405(j)(2)(E)(ii) and 20 C.F.R. § 404.2030(a), before appointing a representative payee and before certifying the first benefit payment, in cases like Ryan's, goes directly to the representative payee (the Department as Ryan's legal guardian). Because the representative payee — in this case, the Department — has discretion in determining the proper allocation of a child's social security benefits, the risk that the child might be deprived erroneously of his or her interest in the benefits may also be substantial. Contra Keffeler III, 151 Wash.2d at 345, 88 P.3d at 956. Congress recognized this risk when it amended the Social Security Act in 2004 to provide more remedies for payee misuse of benefits. See Social Security Protection Act of 2004, Pub.L. No. 108-203, 118 Stat. 493, 493 (2004) (adding federal remedies for misuse and removing the negligence requirement for restitution of benefits misused by institutional payees).
Central to our earlier conclusion here, that an institutional payee may exercise its discretion in allocating a child's social security benefits without the supervision of the juvenile court, is the presence of a federal administrative and judicial review process which serves a checks-and-balances function required to prevent, and remedy, where applicable, improper use of a child beneficiary's social security benefits. Without actual and direct notice, however, a child beneficiary, through his legal representative, is unlikely to know of and utilize timely the review process added by the 2004 amendments to the Social Security Act. See id. If the beneficiary is neither aware that he or she is entitled to benefits, nor that a representative payee is receiving and using those benefits on his or her behalf, he or she is unlikely to benefit from the presence of an adequate federal remedy to test perceived irregularities. Because the juvenile court holds regular hearings to review the permanency plan of every child committed to the Department, see CJP § 3-823(h)(1)(i), and because the Department is required to submit its recommendations for the child's permanency plan prior to the hearing, see CJP § 3-823(d), requiring the Department to provide notice to the child's appointed legal representative in the CINA proceeding that the Department has applied to the SSA to be the payee of the child's OASDI benefits and, if approved, is receiving the child's social security benefits on behalf of the beneficiary is not such a burden as to hinder meaningfully the "[s]tate's interest in efficient administration of its foster care system." Keffeler III, 151 Wash.2d at 345, 88 P.3d at 956.
We therefore conclude that the Department (or its local department of social services) must notify a CINA, through his or her legal counsel, contemporaneously
ADKINS, J., dissenting, which BELL, C.J., (ret.) joins.
I disagree with the Majority's analysis of the jurisdictional issue. Ryan's claims against the Department arise from an alleged breach of fiduciary duty. The Majority concludes, however, that the appropriate forums for the resolution of such claims are "federal administrative and court systems." Maj. Op. at 600, 76 A.3d at 1062. This may have been a proper conclusion had Ryan sought restitution of the allegedly misused benefits from the Social Security Administration (the "SSA") by relying on the provisions in the Social Security Act (the "Act") and the underlying regulations. But Ryan is not seeking restitution from the SSA. He sought to recover the allegedly misused funds by way of a common-law claim. As a court with supervisory authority over "support" of Ryan, a Child in Need of Assistance ("CINA"), the juvenile court had jurisdiction to hear Ryan's case.
As the Majority acknowledges, "[w]hen Congress is silent concerning [concurrent] state court jurisdiction over federal causes of action, there is a `deeply rooted presumption in favor of concurrent state court jurisdiction.'" Majority Op. at 595, 76 A.3d at 1059 (quoting R.A. Ponte Architects, Ltd. v. Investors' Alert, Inc., 382 Md. 689, 715, 857 A.2d 1, 16 (2004), in turn quoting Tafflin v. Levitt, 493 U.S. 455, 459, 110 S.Ct. 792, 795, 107 L.Ed.2d 887 (1990)). This presumption can only "be rebutted by an explicit statutory directive, by unmistakable implication from legislative history, or by a clear incompatibility between
I submit that none of the three abovementioned rebuttals to the presumption of concurrent state jurisdiction are present in this case.
In holding that federal courts enjoy exclusive jurisdiction, the Majority does not take into account the crucial fact that Ryan's claims are against the Department, not the SSA. Rather, the Majority treats the jurisdictional issue in this case as if the question were as to which court had jurisdiction to review the SSA's determination regarding an alleged misuse of the benefits by a representative payee. In answering this hypothetical question, instead of the one presented in this case, the Majority offers several possible reasons for concluding as it does without picking a favorite.
One such possibility the Majority considers is that the Social Security Act itself reserves exclusive jurisdiction to federal courts. See Maj. Op. at 596, 76 A.3d at 1060 (citing the "shall be brought in the district court" language from 42 U.S.C. § 405(g)). According to the Majority, "Congress's use of the word `shall'
A number of other states have found state court jurisdiction even with similar "shall" language in place. See Ecolono v. Div. of Reimbursements of Dep't of Health and Mental Hygiene, 137 Md.App. 639, 769 A.2d 296 (2001); Grace Thru Faith v. Caldwell, 944 S.W.2d 607 (Tenn.Ct.App. 1996); Jahnke v. Jahnke, 526 N.W.2d 159 (Iowa 1994); In re J.G., 186 N.C. App. 496, 652 S.E.2d 266 (2007). The Majority distinguishes those cases only by pointing out that they were decided prior to the 2004 amendments to the Act:
Maj. Op. at 600, 76 A.3d at 1062.
But the lack of a Federal remedy was not the only, or even the primary, basis for
Matter of Kummer, 93 A.D.2d 135, 160-61, 461 N.Y.S.2d 845, 861 (N.Y.App.Div.1983) (emphasis added).
The Kummer court distinguished cases involving the SSA's actions or decisions:
Matter of Kummer, 93 A.D.2d at 156, 461 N.Y.S.2d at 858 (N.Y.App.Div.1983).
The Tennessee Court of Appeals also rejected an argument similar to the Department's here, concluding:
Grace Thru Faith, 944 S.W.2d at 611 (Tenn.Ct.App.1996).
Our own intermediate appellate court concluded that the state had jurisdiction over a similar claim, reasoning:
Ecolono, 137 Md.App. at 654, 769 A.2d at 305 (2001).
Before the 2004 amendments, the SSA reimbursed beneficiaries whose benefits had been misused by their representative payees only if the SSA was negligent in appointing or monitoring the representative payee. The 2004 amendments to the Act expanded the remedy to beneficiaries in cases where the representative payee was not an individual, unless that individual serves 15 or more beneficiaries. 42 U.S.C. § 405(j)(5). In those types of misuse cases, the SSA will make restitution to the beneficiary even in the absence of the SSA's negligence. Id. Neither before nor after the 2004 amendments, however, did the representative payee provisions of 42 U.S.C. §§ 405 and 1383 give a private cause of action to a beneficiary against the representative payee. See Bates v. Northwestern Human Servs., Inc., 466 F.Supp.2d 69, 98 (D.D.C.2006) (denying a claim under the Act because "it is clear that nothing in these statutes expressly states that a beneficiary may file a lawsuit
Notably, although denying Bates' federal claim under the Social Security Act, the Federal District Court for the District of Columbia ruled in favor of Bates' common-law claims for accounting and unjust enrichment against the representative payee. Id. at 102-03 ("The plaintiffs allege, and the defendants do not dispute, that (1) the defendants served as the plaintiffs' representative payees under the Social Security Act; (2) in that capacity, the defendants received federal benefits intended for the plaintiffs; and (3) the defendants owed a fiduciary duty to the plaintiffs as a result of their representative payee status.... These allegations are more than sufficient to sustain a claim of unjust enrichment at the pleading stage").
The Majority holds that federal courts have exclusive jurisdiction over claims such as Ryan's. Applying the reasoning of Bates, I strongly disagree. The Social Security Act does not afford beneficiaries a private right of action against representative payees. This is the nature of Ryan's action — it is an attempt to recover allegedly misused benefits directly from the Department. Ryan's "Motion for Order Controlling Conduct to Conserve Social Security Survivor's Benefits" is akin to an unjust enrichment claim under state law, and the facts alleged suffice under the Bates standard for viable breach of fiduciary duty or unjust enrichment claims.
Nor does the Act suggest that state law remedies against the representative payee are precluded. All that 42 U.S.C. § 405 has ever allowed a beneficiary to do is to seek to have the SSA enforce the statutory provisions and assist with obtaining restitution of misused benefits from the SSA. This is where the need to exhaust the administrative remedies comes in. In order to have the SSA reimburse the representative payee's misused benefits, the beneficiary must follow the administrative process.
The failure of the Act to allow beneficiaries to bring direct claims against representative payees in federal courts is the reason why the D.C. Federal District
In sum, Ryan's claim against the Department is a common-law cause of action for unjust enrichment or breach of fiduciary duty that is not precluded by any provision of the Social Security Act.
The juvenile court is well suited to hear and adjudicate this matter. At the time Ryan became aware of the Department's alleged misuse of his benefits, he was a Child in Need of Assistance. Then, and almost the entire time since he was found to be a CINA in 2002, Ryan had been in the custody of the Department. In accordance with Section 3-823 of the Courts and Judicial Proceedings Article of the Maryland Code ("CJP"), Ryan and the Department came before the juvenile court for regular CINA review hearings. The purpose of those hearings was for the juvenile court to ensure that the services the Department provided to Ryan were consistent with his best interests. See Md. Code (2002, 2013 Repl. Vol.) CJP § 3-819(g).
It was in that same juvenile court, which over the years presided over Ryan's numerous review hearings, that Ryan filed the "Motion for Order Controlling [the Department's] Conduct to Conserve Social Security Survivor's Benefits." He asked the juvenile court to order the Department to conserve in a trust account for Ryan's future needs the $31,693.30 in Social Security Old Age, Survivor, and Disability Insurance benefits that it had received as Ryan's representative payee from the SSA.
As Ryan and the amici correctly point out, the General Assembly has given Maryland's juvenile courts broad supervisory powers to protect the best interests of children who were found CINA. See CJP § 3-802. Indeed, as we have explained:
In re Franklin P., 366 Md. 306, 311 n. 2, 783 A.2d 673, 677 n. 2 (2001) (emphasis in original).
There are also several statutory provisions that specifically address financial support of CINA children and the juvenile court's supervision of local departments of social services. First, CJP § 3-803, titled "Jurisdiction of court," expressly states that juvenile courts have "concurrent jurisdiction over: (i) Custody, visitation,
Juvenile courts also have broad supervisory power over the local departments of social services, which sometimes, as in the present case, are entrusted with managing financial resources of a child found to be a CINA. Namely, CJP § 3-802(c) allows "the court [to] direct the local department to provide services to a child ... to protect and advance a child's best interests." Specifically with respect to a child's property, CJP § 3-819(g) provides that a guardian, including the local department, "has no control over the property of the child unless the court expressly grants that authority." Accordingly, juvenile courts have broad supervisory powers over the Department generally and its handling of a CINA child's property.
Despite these statutory provisions, the Court of Special Appeals held that the juvenile court had no jurisdiction to hear Ryan's claims.
But that is not so. Setting aside the statutory sources of the juvenile court's specific authority to oversee the issues relating to financial support of children in CINA cases and to supervise the Department's conduct in these cases, "[i]t is a fundamental common law concept that the jurisdiction of [juvenile] courts is plenary so as to afford whatever relief may be necessary to protect the [child's] best interests." Wentzel v. Montgomery Gen. Hosp., Inc., 293 Md. 685, 702, 447 A.2d 1244, 1253 (1982). The juvenile court, "acting under the State's parens patriae authority, is in the unique position to marshal the applicable facts, assess the situation, and determine the correct means of fulfilling a child's best interests." In re
While Ryan bounced from one group home to the next, sometimes staying at places that allegedly lacked basic necessities but cost $6,000 a month, the Department used Ryan's social security benefits to reimburse itself for the cost of this care. It is difficult to imagine any court — other than the juvenile court — more familiar with Ryan's circumstances and thus in a better position to determine whether the Department's use of the benefits in such a way was in Ryan's best interest.
In conclusion, because the Social Security Act does not preclude a common-law action for unjust enrichment or breach of fiduciary duty against a representative payee, and the juvenile court is authorized to adjudicate matters related to protecting the bests interests of children designated CINA, I would allow Ryan's action to go forward based on the allegations plead.
For these reasons, I most respectfully dissent.
Chief Judge BELL (ret.) authorizes me to state that he shares the views set forth in this dissenting opinion.
20 C.F.R. § 404.2010. There is no evidence in this record that Ryan W. possessed an "ability to manage the benefits."
20 C.F.R. § 404.2040(b). The COSA's second opinion implies that the regulation addresses explicitly the issue of institutional charges in excess of the beneficiary's social security benefit payments. The regulation cited, however, does not clearly indicate that such a situation is pertinent to the rule set forth in subsection (b). Rather, the illustration provided does not indicate the total income or assets of the institutionalized beneficiary. Most likely, this information is left out because the focus of the illustration is to provide examples of acceptable personal expenses that the representative payee deems necessary, or at least is in line with the language of subsection (b). See id.
CJP § 3-821.
