Gossett v. Czech

CourtCourt of Appeals for the Ninth Circuit
DecidedSeptember 9, 2009
Docket06-16973
StatusPublished

This text of Gossett v. Czech (Gossett v. Czech) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gossett v. Czech, (9th Cir. 2009).

Opinion

FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

PAUL GOSSETT,  No. 06-16973 Plaintiff-Appellant, v.  D.C. No. CV-04-03523-WHA AL CZECH, Trust Officer, OPINION Defendant-Appellee.  Appeal from the United States District Court for the Northern District of California William H. Alsup, District Judge, Presiding

Argued and Submitted June 4, 2009 Pasadena, California

Filed September 9, 2009

Before: William A. Fletcher, Richard R. Clifton and Milan D. Smith, Jr., Circuit Judges.

Opinion by Judge Milan D. Smith, Jr.

12841 GOSSETT v. CZECH 12843

COUNSEL

Paul Gossett, pro se plaintiff-appellant.

Charles C. Lifland, Jeremy Maltby, and A. Patricia Klemic, O’Melveny & Myers LLP, Los Angeles, California, amicus curiae in support of plaintiff-appellant Paul Gossett.

Tanya L. Jackson, UCLA School of Law Ninth Circuit Clinic, Los Angeles, California, amicus curiae in support of plaintiff- appellant Paul Gossett.

Edmund G. Brown, Jr., Attorney General of the State of Cali- fornia, and Harry T. Gower, Deputy Attorney General, San Francisco, California, for the defendant-appellee Al Czech. 12844 GOSSETT v. CZECH OPINION

MILAN D. SMITH, JR., Circuit Judge:

Paul Gossett (Gossett), a committed inmate at Napa State Hospital (the Hospital), appeals from the district court’s sum- mary judgment order in his 42 U.S.C. § 1983 action alleging that Al Czech (Czech), the Trust Officer of the Hospital, unlawfully took a portion of his Department of Veterans Affairs (VA) benefits each month and applied the money to partially defray the cost of Gossett’s care at the Hospital. Gos- sett claims this reimbursement violated the statutory provision that makes benefits earned by United States military veterans “exempt from the claims of creditors.” 38 U.S.C. § 5301(a)(1). Gossett also claims on appeal that Czech vio- lated certain conditions and specified procedures contained in the regulations implementing this statute. See 38 C.F.R. §§ 13.58, 13.71. We affirm and hold that 38 U.S.C. § 5301(a)(1), when read in combination with pertinent regula- tions such as 38 C.F.R. § 13.71, does not prohibit direct pay- ments of VA benefits to a state hospital for ongoing veteran patient care.

FACTUAL AND PROCEDURAL BACKGROUND

Paul Gossett is a military veteran who is entitled to receive VA benefits. In 1982, Gossett was found not guilty of murder by reason of insanity and was committed to a state psychiatric hospital by court order. Gossett was transferred to the Hospi- tal, where he is currently detained, in September of 1996.

In 1997, the VA found Gossett mentally incompetent to manage his own affairs. The VA appointed Czech to serve as Gossett’s legal custodian and entered into a fiduciary agree- ment providing that the Hospital would be reimbursed from VA benefits for the costs it incurs as a result of Gossett’s care. Since the agreement has been in effect, Czech has been using Gossett’s VA funds to provide Gossett a monthly stipend for GOSSETT v. CZECH 12845 groceries and sundries and to partially reimburse the Hospital for the costs of Gossett’s care.

On July 15, 2004, Gossett brought this action under 42 U.S.C. § 1983 in the United States District Court for the Northern District of California, claiming that Czech’s use of his VA benefits to reimburse the Hospital was unlawful under various federal and statutory laws.1 The Complaint sought to “permanently enjoin the said state hospitals and their person- nel from any future misappropriation of funds, to seek puni- tive damages, declaratory relief, and any other relief that is just, equitable and proper.” Czech moved for summary judg- ment, claiming that he used Gossett’s funds “in a manner authorized and required by federal and state law, in particular 38 C.F.R. section 13.71 and by California Health and Welfare Code section 7275, as well as by Departmental policy,” and that his actions were proper under Washington State Depart- ment of Social and Health Services v. Keffeler, 537 U.S. 371 (2003), a case involving state use of Social Security (SS) ben- efits as reimbursement for costs incurred in caring for eligible foster children.

The district court granted Czech’s motion for summary judgment and dismissed Gossett’s claim. The court extended the logic of the Supreme Court’s Keffeler ruling to veterans’ benefits, and held that a “representative payee’s” use of VA funds for support of the beneficiary does not violate Section 5301(a)(1). Gossett appeals.

JURISDICTION AND STANDARD OF REVIEW

This court has jurisdiction under 28 U.S.C. § 1291. We review a grant of summary judgment de novo. See Aguilera v. Baca, 510 F.3d 1161, 1167 (9th Cir. 2007). 1 The Complaint also named “Trust Officer of Patton State Hospital” as a defendant. Defendant “Trust Officer of Patton State Hospital” was never successfully served, and was dismissed from the suit for lack of service. See Fed. R. Civ. P. 4(m). 12846 GOSSETT v. CZECH DISCUSSION

I

[1] The Veterans’ Benefits Act (VBA), Pub. L. No. 85-56, 71 Stat. 83 (1957) (codified as amended at 38 U.S.C. § 301 et seq.), contains a provision that limits the availability of VA benefits for the payment of certain types of claims:

Payment of benefits due or to become due under any law administered by the Secretary shall not be assignable except to the extent specifically autho- rized by law, and such payments made to, or on account of, a beneficiary shall be exempt from taxa- tion, shall be exempt from the claim of creditors, and shall not be liable to attachment, levy, or seizure by or under any legal or equitable process whatever, either before or after receipt by the beneficiary.

38 U.S.C. § 5301(a)(1). This exemption provision protects the veteran recipient of the benefits and affords security for his or her family. The VBA also dictates the manner in which pay- ments of VA benefits are made to fiduciaries, allowing that “payment of benefits under any law administered by the Sec- retary may be made directly to the beneficiary or to a relative or some other fiduciary for the use and benefit of the benefi- ciary.” 38 U.S.C. § 5502(a)(1). Here, Gossett brings a Section 1983 action, claiming that defendant Czech, his legal custo- dian authorized to receive and administer his veterans’ bene- fits, has been using part of his benefits to reimburse the Hospital for Gossett’s care and maintenance in violation of 38 U.S.C. § 5301

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