Feb 28, 2011

What Do You Think?

Fact Situation: Ms. Claimant has a Social Security disability claim pending in one state. She hires Attorney A to represent her. Shortly thereafter, Ms. Claimant moves to another state. She contacts Attorney A to tell him. He tells her that he knows Attorney B who practices in the state she is moving to. Attorney A tells Ms. Claimant to contact Attorney B once she gets to the state she is moving to. Attorney A tells Ms. Claimant that he will waive his fee so she will not have any problem hiring Attorney B. She contacts Attorney B once she gets to her new state. Attorney A withdraws and waives his fee. Attorney B files the appropriate paperwork to represent Ms. Claimant. Some months later after a hearing, Ms. Claimant's case is approved. She is paid. Attorney B receives her fee but is shocked to discover that it is half of what she expected. The reason is that Social Security has decided that since Attorney A waived his fee that it will release half of the fee to Ms. Claimant.

The above fact situation is in accordance with Social Security policy, although it is a policy that is haphazardly implemented.

Queries: Does this policy make sense? Is the rare implementation of this policy an indication that it does not make sense? Does this policy unduly restrict a claimant's ability to obtain a new attorney if he or she moves or otherwise needs or wishes to change attorneys? Why does Social Security have such difficulty in developing policies concerning attorney fees? Why are there almost no regulations concerning attorney fees?

Update: Many of the comments say there is something wrong with the fact pattern given. The assumption is that this cannot possibly be correct. Social Security's manual states that:
SSA will not authorize to any co-representative the share of a co-representative who waived a fee. When SSA has withheld title II and/or title XVI past-due benefits for payment of a representative's fee, SSA releases the waived share to the claimant(s).
This policy is being applied, haphazardly, to the fact situation given. Yes, the manual instructions can be read differently, but what is happening on the ground is chaotic and attorneys have no recourse. It is a mess.

13 comments:

Anonymous said...

The easier solution is to just keep representing the claimant when she moves and collect your full fee. Even with travel expenses, if any, it will surely be more than half.

Anonymous said...

You could also do what some national firms do...hire experienced local attorneys as "members" of the firm for the purpose of the hearing, and collect the full fee after paying the local attorney.

The big problem here is the SSA policy of not allowing the fee agreement process when appointed representatives are not in the same firm. The solution to this is simple: Allow the representatives or claimant to designate which person will be paid the fee and make the other representatives waive any action against SSA or claimant regarding the fee. If there is a dispute between representatives, let them fight it out without the involvement of SSA or the claimant.

Anonymous said...

If attorney A withdrew his right to representation instead of waiving the fee, wouldn't the full fee then go to attorney B?

Dennis Cloud said...

No Way! Attorney B should get 25 percent, if that is reasonable. The 25 percent is the maximum amount allowed for direct payment. Both A and B could be approved 25 percent (for a total of 50), but each would receive direct payment of only part of their fee (probably 12.5 each) and each would have to collect the additional 12.5 each from the claimant.

Anonymous said...

This fact pattern makes no sense,unless 25% of Ms. Claimant's fee was $12,000. Thus limiting Atty. B's fee to $6K and hence she received 50% of what she expected.

If attorney A withdrew as counsel and waived a fee, then Atty. B's fee agreement should be granted. NOTE: many times attorneys just withdraw and don't specifically waive a fee (they meant to, but didn't clearly state it). This causes problems as well.

Now, if you are talking about fee petitions, the scenario can change again in a million little ways that cannot be sussed out in this forum because of all the variables.

Something is missing in this fact pattern.

What policy are you claiming applies?

Anonymous said...

It's nice to see that even Attorney's can't follow the sequence of events when Claimant's change reps.

Anonymous said...

It is important to understand that SSA assumes any appointed representative will charge a fee for his or her services. As pointed out by other commenters, the fact pattern provided in this post leaves a number of unanswered questions; not the least of which is how Attorney A waived his fee and how or whether that was communicated to SSA.

Anonymous said...

Atty A and B were never co-representatives. If Ms. Claimant initially appointed Atty A & B, or appointed A and then B without A withdrawing, then they would be co-representatives.

Anonymous said...

Anon 2:30 pm is correct. They were never co-representatives. They were successive representatives. Atty. A withdrew and (presumably)correctly waived his/her right to collect a fee.

I guess someone could make the absurd argument that there was a brief period when A rep'd C and B rep'd C simultaneously (that is during the period between A withdrawing/waiving and B being appointed). But that would be bureaucracy at its best/worst depending on where you sit.

But based on these facts they were never co-representatives as that would is usually defined. Now if SSA has their own special definition well . . .

On a side note,if this policy is being instituted as claimed, I would say there is some kind of action on behalf of all claimant's affected that it has the potential to deny them effective counsel if they move (and counsel doesn't travel, remember in this particular forum they don't need permission to withdraw).

The fact is SSA hates attorneys outside/inside and you have a bunch of non-attorney policy makers/enforcers who can't even hide their glee in twisting up attorneys (who are not a very a sympathetic group as a whole).

Anonymous said...

Does anyone think that representatives should be excited to get as much as they do! Seriously, how about 300 bucks per claimant, thats about how much work most representatives do when it comes to social security and representing claimants

Anonymous said...

Let SSA stay out of it. Pay the claimant what s/he is due. Let the attorneys get their payment from the claimant. SSA will save a lot of time and resources.

Mel said...
This comment has been removed by the author.
Anonymous said...

Amen to Anon 7:35 a.m.!