Muñoz v. Chandler

42 P.3d 657, 98 Haw. 80, 2002 Haw. App. LEXIS 25
CourtHawaii Intermediate Court of Appeals
DecidedFebruary 21, 2002
DocketNo. 23485
StatusPublished
Cited by3 cases

This text of 42 P.3d 657 (Muñoz v. Chandler) is published on Counsel Stack Legal Research, covering Hawaii Intermediate Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Muñoz v. Chandler, 42 P.3d 657, 98 Haw. 80, 2002 Haw. App. LEXIS 25 (hawapp 2002).

Opinion

Opinion of the Court by

WATANABE, J.

Plaintiffs-Appellants Connie B. Muñoz (Connie) and Peter Muñoz (Peter) (collectively, the Muñozes or Appellants) appeal from the May 10, 2000 judgment entered by the Circuit Court of the Second Circuit (the circuit court), Judge Joseph E. Cardoza presiding, that affirmed the October 30, 1998 decision of the Appeals Administrator (the AA) for Defendanf-Appellee Susan M. Chandler (Chandler), Director of the Department of Human Services for the State of Hawaii (DHS), which concluded that DHS had overpaid the Muñozes $294.00 in Aid to Families with Dependent Children (AFDC) benefits during September and October 1996.

[81]*81The Muñozes’ primary contentions on appeal 1 are as follows: (1) DHS deprived them of their constitutional right to due process by conducting them hearing to challenge the amount of them overpayment by telephone; (2) DHS violated its own rules in conducting the telephone hearing; (3) DHS violated government rules and law by refusing to specify the legal authority under which the telephone hearing was to be held; and (4) DHS improperly deprived them of them right to have legal counsel present at them hearing.

Based on our review of the record, we agree with the Muñozes’ last three contentions. Accordingly, we vacate the circuit court’s judgment and remand this case to the circuit court, with instructions that this case be remanded to DHS for a new hearing. Our disposition of this appeal renders it unnecessary to address the Muñozes’ first contention.

BACKGROUND

In 1996, the Muñozes, who are both disabled from working, were receiving AFDC benefits for themselves and their son, Miguel, who was born on August 30, 1978. On September 25, 1996, DHS sent Connie a notice that stated, in relevant part, as follows:

EFFECTIVE NOVEMBER 1996 YOUR FINANCIAL ASSISTANCE PAYMENT SHALL BE STOPPED BECAUSE THERE IS NO ELIGIBLE DEPENDENT CHILD IN THE HOME. ’"MIGUEL MU[Ñ]OZ HAS TURNED 18 ON 08/30/96 AND HAS GRADUATED FROM HIGH SCHOOL. SINCE YOU ARE ENTITLED TO TIMELY NOTICE OF FINANCIAL CLOSURE!,] BENEFITS FOR SEPTEMBER AND OCTOBER 1996 WERE AUTHORIZED BUT WILL BE CONSIDERED AN OVERPAYMENT FOR THOSE MONTHS—NOTICE TO BE SENT[.]
THIS ACTION IS BASED ON HAWAII PUBLIC WELFARE MANUAL SECTION(S): 17-649-4,[2] 17-656-3,[3] 17-656-4.[4]
[82]*82FAIR HEARING RIGHTS AND OTHER IMPORTANT INFORMATION ARE EXPLAINED ON THE BACK OF THIS NOTICE. IF YOU WISH CONTINUED BENEFITS WHILE AWAITING A FAIR HEARING, YOUR WRITTEN REQUEST FOR A FAIR HEARING MUST BE RECEIVED BY OCTOBER 04, 1996.
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HOUSEHOLD WILL NO LONGER BE ELIGIBLE FOR FREE NO-FAULT CAR INSURANCE EFFECTIVE OCTOBER 31, 1996. YOU MAY REAPPLY FOR FINANCIAL BENEFITS UNDER THE GENERAL ASSISTANCE PROGRAM FOR YOU AND SPOUSE[.] HOWEVERL] THIS PROGRAM DIFFERS FROM THE AFDC PROGRAM YOU HAVE PARTICIPATED IN. IF INTERESTED!,] COME IN TO COMPLETE AN APPLICATION.

(Footnotes added.) The reverse of the notice provided, in relevant part:

If you do not agree with the intended change, you may call your worker or you may have an informal review meeting with your worker’s supervisor to present evidence to prevent or correct the intended action.
You also have the right to request a fair hearing before a Hearing Officer. This request must be in writing on our Depart-. ment’s form or any other paper (oral request acceptable for food stamps) and must state why you don’t agree with the change. Our office must receive this re-' quest within 90 days of the date of this notice.

The Muñozes responded to the foregoing notice by a November 23, 1996 letter, in which they explained that had they been given timely notice of the change in status, they would have applied for alternate financial aid to avoid “a two[-]month ‘void’” in them benefits. In the letter, the Muñozes stated: ‘We certainly agree and would abide by a voluntary repayment plan of funds payed [sic] over and above what we received for September and October based on our eligible amount that we would have been entitled to for September and October had we, in fact, been • given ‘timely notice’ and applied for same.” The letter ended with the Muñozes requesting “a ‘fair hearing’ ... or if that is not possible that you cause a subpoena to be served upon us so that we might fairly and equitably present our side, to this one[-]sided matter[.]”

On December 4, 1996, the Muñozes sent another letter to DHS, again requesting a hearing concerning the matter set forth in them letter of November 23, 1996 but expressing a preference for negotiating a settlement of the matter.

By a letter mailed on December 4, 1996, DHS informed the Muñozes, in pertinent part:

YOU RECEIVED $1,424 MORE IN FINANCIAL ASSISTANCE PAYMENTS THAN YOU WERE ENTITLED TO RECEIVE DURING THE MONTHS OF SEPTEMBER AND OCTOBER 1996; WHICH MUST BE REPAID TO THE DEPARTMENT. THE OVERPAYMENT. OCCURRED BECAUSE EFFECTIVE 09/96 THERE WAS NO ELIGIBLE DEPENDENT CHILD IN THE HOME. MIGUEL MU[Ñ]OZ TURNED 18 YRS OLD 08/30/96 AND HAD GRADUATED FROM HIGH SCHOOL IN JUNE 1996.
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[xx] OUR FISCAL OFFICE WILL BE SENDING YOU A BILL AND ADVISING YOU AS TO HOW AND WHERE TO PAY.

Five days later, on December 9, 1996, DHS mailed another letter to the Muñozes that reduced the amount of them alleged overpayment obligation to $972.00 “TO REFLECT [THE] HOUSEHOLD’S FINANCIAL ELIGIBILITY EFFECTIVE 10/07/96 IN THE GENERAL ASSISTANCE FINANCIAL PROGRAM FOR [THE MUÑOZES] ONLY (APPLICATION FORM RECEIVED [83]*8310/07/96).” The letter also informed the Mu-fiozes that DHS’s “FISCAL OFFICE WILL BE SENDING YOU A BILL AND ADVISING YOU AS TO HOW AND WHERE TO PAY.”5

DHS’s fiscal office, however, neither sent the Mufiozes the promised bill nor advised them how and where to pay the $972.00. DHS’s next communication to the Mufiozes was a “STATE TAX REFUND PRE-SET-OFF NOTICE,” mailed on July 15, 1997, which informed them, in part, as follows:

IF YOU ARE ENTITLED TO A HAWAII STATE INCOME TAX REFUND FOR ANY TAX YEAR, [DHS] PROPOSES TO TAKE IT BECAUSE YOU HAVE NOT MADE REGULAR PAYMENTS FOR A FINANCIAL, FOOD STAMP, OR MEDICAL ASSISTANCE DEBT OF AT LEAST $972.00 THAT YOU OWE THE DEPARTMENT. HAWAII REVISED STATUTES [(HRS)] CHAPTER 231 AUTHORIZES THE DEPARTMENT TO SETOFF [sic] STATE INCOME TAX REFUNDS TO REPAY DEBTS.
* * * YOU MAY REQUEST A REVIEW * ⅜ *
IF YOU HAVE MADE REGULAR PAYMENTS TOWARD THE DEBT, YOU DO NOT BELIEVE THAT YOU OWE A DEBT, OR IF YOU WANT A FURTHER EXPLANATION ABOUT YOUR DEBT, WE WILL REVIEW YOUR CASE. PLEASE CONTACT US BY 08/14/97 FOR A TELEPHONE REVIEW, OR TO ARRANGE FOR AN OFFICE VISIT....
* * * YOU HAVE A RIGHT TO A HEARING * * ⅜
IF YOU DISAGREE WITH THE REVIEW, YOU HAVE THE RIGHT TO A HEARING. IN ORDER TO GET A HEARING, YOU MUST FIRST REQUEST A REVIEW. IF YOU DO NOT REQUEST A REVIEW, YOU WILL NOT BE GIVEN A HEARING BEFORE WE TAKE YOUR TAX REFUND. SOME OF THE DEFENSES YOU MAY HAVE AGAINST THE TAX REFUND SETOFF ARE:
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Bluebook (online)
42 P.3d 657, 98 Haw. 80, 2002 Haw. App. LEXIS 25, Counsel Stack Legal Research, https://law.counselstack.com/opinion/munoz-v-chandler-hawapp-2002.