United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                   ___________

                                   No. 99-4183
                                   ___________

Jim Coulston,                       *
                                    *
             Appellant,             *
                                    * Appeal from the United States
      v.                            * District Court for the Southern
                                    * District of Iowa.
Kenneth S. Apfel, Commissioner      *
of Social Security,                 *      [PUBLISHED]
                                    *
             Appellee.              *
                               ___________

                             Submitted: June 16, 2000

                                  Filed: September 21, 2000
                                   ___________

Before WOLLMAN, Chief Judge, BEAM, and BYE, Circuit Judges.
                             ___________

PER CURIAM.

      Occasionally, the Social Security Administration (the Administration) sends a
benefit check to the wrong person. When this occurs, the Administration is entitled to
recover the money unless the recipient of the check was without fault and recovery
would subvert the purpose of social security or be against equity and good conscience.
See 42 U.S.C. § 404.
      In this case, the Administration erroneously sent a $20,658 check to Jim
Coulston, a man who receives benefits because of an intellectual impairment.
Coulston, who has trouble reading, thought the check was a back payment for medical
expenses because he canceled his Medicare, so he cashed the check and used most of
the money to pay bills and purchase Christmas presents. We must now decide whether
the Administration may recoup its money. We find it may not.

       Coulston returned the unspent money to the Administration, but he did not have
the resources to immediately repay the money already spent. The Administration
threatened to withhold any further benefit checks from Coulston until it reclaimed the
remainder ($18,249) of the money. Coulston then sought a waiver from repayment to
the Administration, asserting he was without fault and that recovery would subvert the
purpose of social security or be against equity and good conscience. He received a
hearing before an Administrative Law Judge (ALJ), who found Coulston undeserving
of a waiver. Coulston then brought his case to federal district court, which upheld the
ALJ's determination. So, to decide this case, we must review the ALJ opinion and the
record evidence.

       After receiving the check, Coulston got, in the ALJ's words, "advice from and
was assisted by" his ex-wife and a friend. Basically, this assistance was in cashing and
spending the check. In determining whether Coulston was without fault, the ALJ relied
substantially on the role Coulston's ex-wife and friend played. The ALJ noted that,
while Coulston had an intellectual impairment, there was no evidence that either his ex-
wife or friend suffered from a similar disability. This led the ALJ to conclude that,
before cashing and spending the check, "at least one of the three individuals involved"
should have made further inquiries with the Administration. The ALJ also noted that,
in deciding the case, he considered that neither Coulston's ex-wife nor friend testified
at the hearing to explain why they did not question Coulston's receipt of the check.
Also important to the ALJ's conclusion was the ability of Coulston's ex-wife and friend
to manage their own finances and dispense advice.

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       The thrust of much of the ALJ's opinion is that Coulston's ex-wife and friend
knew or should have suspected what was going on. This may well be true, but it is
irrelevant. The Administration's regulations state that a claimant is at fault if he knew
or should have known the overpayment was incorrect. See 20 C.F.R. § 404.507. The
Administration's regulations also state that the determination of fault is only made as
to the overpaid individual or any other person from whom the Administration seeks to
recover. See 

means in this case is that the ALJ should have considered
what Coulston himself knew or should have known. Instead, the ALJ relied
substantially on what Coulston's ex-wife and friend should have known; and while
Coulston's ex-wife and friend very well may have known (or should have known) what
was going on, it was erroneous to impute their actions and abilities to Coulston.

        We also think the ALJ did not properly account for the intellectual impairments
of Coulston. When determining whether an overpaid individual is without fault, the
ALJ is required by statute to "specifically take into account" the individual's mental or
educational limitations. See 42 U.S.C. § 404(b). To be fair, the ALJ noted most of
Coulston's intellectual and educational limitations, including: his difficulty with reading
and writing; his attendance of special education classes at school; and his eight months
of training with Goodwill Industries to learn the skill of dishwashing. But, the ALJ then
basically ignored how these limitations would have affected Coulston's ability to know
the check was erroneous. Instead, as related above, the ALJ relied substantially on the
lack of intellectual limitations of Coulston's "advisors"—his ex-wife and friend.

       The ALJ also placed significant emphasis on the events surrounding Coulston's
attempts to cash the check. The ALJ found Coulston was unable to cash the check at
the first bank he tried—the obvious inference being that the bank refused to cash the
check because of its substantial amount. This, according to the ALJ, should have been
a tip-off to Coulston and to his friend that a problem existed with the check. But, the
record reveals the bank refused to cash the check because of a problem with Coulston's
identification, not because of the large amount of the check. And, again, while his

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friend may have known the real situation, Coulston's intellectual limitations may well
have prevented him from ascertaining the real situation.

       The parties in this case make much of Coulston's supposed interaction or
supposed non-interaction with the Administration in the month following his receipt of
the erroneous check. After Coulston received the check, he received a notice from the
Administration informing him he was entitled to the check and to a substantial increase
in his monthly benefits. The Administration claims Coulston only received this notice
after he became aware the check was an error. Coulston also claims he and his ex-wife
made several phone calls to the Administration, and Administration employees said he
was entitled to the $20,658. The Administration claims that, in every phone call, they
informed Coulston he was not entitled to the money. But, the ALJ declined to credit
either version of events, and so do we. The evidence on this issue is inconclusive, and,
as an appellate court, we should not engage in fact-finding on this issue. See Duffie v.
Deere & Co., 

, 74 (8th Cir. 1997) (role of appellate court is to "review,
rather than to make, findings of fact").

       The Administration also calls to our attention Coulston's "history" of
overpayments. Apparently, in the early 1980s, Coulston was overpaid by about
$4,000. But, the ALJ made no mention of this history in his opinion, and we do not put
much stock in it either, as we doubt most people, even those without an intellectual
impairment, would remember an overpayment incident that occurred almost fifteen
years earlier.

      So, after a careful review of the record, the following evidence remains: Coulston
has an intellectual impairment substantial enough to entitle him to social security
benefits for the last twenty-plus years; he received a check with an overpayment; he
believed the overpayment was for back medical payments because he had canceled his
Medicare policy; he spent much of the check to pay off bills and buy Christmas
presents until informed the check was a mistake; and he then paid back the remaining

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money. Is this enough for Coulston to meet his burden of proving he is without fault?
See Banuelos v. Apfel, 

, 1170 (7th Cir. 1999) (claimant has burden of
proving entitlement to waiver of repayment), overruled on other grounds by Johnson
v. Apfel, 

, 562 (7th Cir. 1999); Watson v. Sullivan, 

, 171
(6th Cir. 1991) (same); Viehman v. Schweiker, 

, 227 (11th Cir. 1982)
(same).

       We think Coulston meets his burden; but barely. Generally, if the evidence is
in equipoise, the party with the burden of proof loses. See Cigaran v. Heston, 

, 357-58 (8th Cir. 1998). The evidence here is so close that it is almost in
equipoise. But, Coulston testified he thought the overpayment was for back medical
payments. The ALJ had the opportunity to discredit this testimony, and did not. So,
Coulston's subjective thinking, coupled with the objective evidence of his intellectual
impairment, leads us to conclude he has met his burden of proving he was without fault.

       Our finding that Coulston was without fault does not automatically result in a
victory for him. We must also determine whether repayment would defeat the purpose
of providing social security to Coulston or would be against equity or good conscience.
See 42 U.S.C. § 404(b).

      Coulston is far from well-off. Coulston works on-and-off as a part-time
dishwasher, and he receives about $650 a month in social security benefits. Thus, his
annual income skirts the poverty line. See United States Census Bureau (visited Aug.
14, 2000)  (1999 poverty
threshold is $8,667). Coulston also has no savings account, so he obviously lives from
check to check. See 

(considering claimant's assets in
determining whether repayment defeats purpose of social security). In light of these
circumstances, we credit Coulston's statement at the hearing that he "has a hard time
making ends meet," and, because of this, we think taking even a small amount of
benefits away from Coulston would defeat the purpose of social security.

                                         -5-
       For the foregoing reasons, we reverse and remand to the district court with
directions to enter judgment in favor of Coulston. See Gladden v. Callahan, 

, 1223 (8th Cir. 1998).

BYE, Circuit Judge, concurring.

       I join in the result reached by the majority, but I cannot join in the majority's
reasoning. I write separately to emphasize those points. First, the majority ignores the
standard of review that governs this case, and I believe that the standard ought to be
explicated and applied. Second, the majority makes its own estimate (though it should
not) of Coulston's ability to repay the SSA.

                                           I

       Federal courts review many different kinds of decisions rendered by the
Commissioner of Social Security. In virtually every such case, courts' review is
governed by the statutory "substantial evidence" test. See 42 U.S.C. § 405(g) ("The
findings of the Commissioner of Social Security as to any fact, if supported by
substantial evidence, shall be conclusive").

       We subject the Commissioner's decision to deny a claimant's request for a waiver
of repayment in an overpayment of benefits case to the very same standard of review.
See Gladden v. Callahan, 

, 1220, 1222, 1223 (8th Cir. 1998); accord
Watson v. Sullivan, 

, 169, 171 (6th Cir. 1991); Viehman v. Schweiker,

, 227 & n.5 (11th Cir. 1982) ("Substantial evidence sets the parameters
for our review of the Secretary's adverse final determination in this [overpayment of
benefits] case.").




                                          -6-
       The majority explains that Coulston bore the burden of proving that he was not
at fault. That is true enough. But it misses the point. We are not here concerned with
whether Coulston met his burden of proving to the Commissioner that he was not at
fault. Our sole concern is to determine whether the Commissioner's ultimate decision
— that Coulston was at fault, and was not entitled to a waiver of repayment — was
based upon "substantial evidence." If so, we are obliged to affirm the Commissioner's
decision. See 42 U.S.C. § 405(g).

      I conclude that the ALJ's decision is not supported by "substantial evidence," for
the simple reason that the Commissioner introduced no evidence to controvert
Coulston's account of events. The Commissioner failed to come forward with any
evidence supporting its position that Coulston was at fault. Coulston, for his part,
presented evidence (much of which the ALJ did not discredit) that he had relied upon
the SSA's representations that the money was his. Hence, the ALJ's ultimate decision
that Coulston was at fault lacked support in the record — substantial or otherwise. As
a matter of logic, the utter absence of evidence in the record cannot be deemed
"substantial."1

       The majority apparently confuses Coulston's administrative burden (proving non-
fault) with his appellate burden (demonstrating a lack of "substantial evidence"). For
that reason, I cannot join in the majority opinion. Reviewed under the proper standard,
the record reveals no substantial evidentiary basis to support the Commissioner's
conclusion that Coulston was at fault.


      1
       The one exception to this rule of thumb is when a claimant fails to present
evidence. Then, the Commissioner ought to deny relief on the ground that the claimant
has not met his burden of proof. If, in such a case, the Commissioner also failed to
present evidence, the total absence of any evidence in the record would not preclude
our affirmance — despite the ostensible absence of "substantial evidence." That's
because the Commissioner's ruling would be based purely upon the burden of proof,
not upon the evidentiary merit of the claimant's contentions.

                                          -7-
                                           II

       The majority properly proceeds to examine the second step of the overpayment
analysis, whether Coulston's repayment "would defeat the purpose of [Title II] or would
be against equity and good conscience." 42 U.S.C. § 404(b). The majority compares
Coulston's monthly income with the poverty line and determines that Coulston could
not afford to repay the SSA. Yet the record suggests the possibility of a different
answer. Coulston receives about $650 a month in SSA benefits, and he earns about
$500 per month as a part-time dishwasher. Adding those sums together, his total
monthly income exceeds $1100. Given Coulston's remarkably low estimate of his
monthly expenses, he appears to have at least $500 per month in disposable income.
Presumably, some portion of that income could be used to repay the SSA without
defeating the purpose of social security.

       These calculations are, of course, my own findings of fact. The majority's
conclusion that Coulston cannot repay the SSA is equally dependent on implicit fact-
finding. Our disagreement illustrates why circuit judges are properly loathe to find the
facts on appeal. See Cox v. Apfel, 

, 1210 (8th Cir. 1998). Faced with
a fact-dependent impasse, the majority ought to remand to permit the ALJ to make
"ability to repay" findings.2

       Despite the presence of this potential factual dispute, however, we need not
remand. A claimant's reliance on agency representations automatically establishes that
repayment would offend equity and good conscience. See 

.
Much like the claimant in Gladden, Coulston relied upon a host of SSA representations
in assuming that the lump-sum check belonged to him. I am hard-pressed to overlook
Gladden's clear language in favor of the majority's own calculation of Coulston's ability


      2
       The ALJ never calculated Coulston's ability to repay (the second step) since he
found Coulston "at fault" (the first step).

                                          -8-
to repay. I deem Gladden controlling, and I would avoid analyzing Coulston's financial
picture entirely. The majority's methodology leads ineluctably to the conclusion that
this matter ought to be remanded — a conclusion in considerable tension with Gladden.

      I respectfully concur in the judgment of the court.

      A true copy.

             Attest:

                CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




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