13 soc.sec.rep.ser. 390, unempl.ins.rep. Cch 16,828 Berdie Thomas v. Otis R. Bowen, Secretary of Health and Human Services, Defendants

791 F.2d 730 13 Soc.Sec.Rep.Ser. 390, Unempl.Ins.Rep. CCH 16,828 Berdie THOMAS, et al., Plaintiffs-Appellees, v. Otis R. BOWEN, Secretary of Health and Human Services, et al., Defendants- Appellants. Nos. 84-1845, 85-1634. United States Court of Appeals, Ninth Circuit. Argued and Submitted Jan. 15, 1986. Decided June 9, 1986. Tricia Margot Berke Vinson, Redwood City, Cal., Susan J. Balliet, East Palo Alto Comm. Law Project, East Palto, Cal., for plaintiffs-appellees. Freddi Lipstein, Atty., U.S. Dept. of Justice, Washington, D.C., for defendants-appellants. Appeal from the United States District Court for the Northern District of California. Before POOLE, BEEZER and KOZINSKI, Circuit Judges. KOZINSKI, Circuit Judge. 1 We review the district court's decision that appellants, the Secretaries of Health and Human Services and of the Treasury ("the government"), acted unlawfully in recouping social security benefits erroneously deposited by electronic fund transfer ("EFT") into bank accounts held by appellees after the deaths of their husbands. Facts 2 The three named plaintiffs, Berdie Thomas, Joy Nutter and Inez Polson, are widows whose husbands were receiving social security…

concurring.

While, for the reasons explained above, I believe this case is squarely controlled by Powderly v. Schweiker, 704 F.2d 1092 (9th Cir.1983), I write these additional thoughts to express concern about Powderly , at least as it applies to appellant Berdie Thomas. 1 The majority in Powderly gave short shrift to the widow’s due process claim and held that the government could unilaterally debit her bank account to recoup funds she had received by cashing her deceased husband’s check. 2 I see a serious tension be *735 tween this ruling and established principles of private property. My concern is the apparent absence of any lawful authority for the government to reach into Mrs. Thomas’ bank account and extract the funds it claims.

Bank accounts are contracts between private parties. These contracts, and the laws governing them, establish a property interest in the funds held by the bank on behalf of the depositor. See Anderson National Bank v. Luckett, 321 U.S. 233, 240 , 64 S.Ct. 599, 603 , 88 L.Ed. 692 (1944). Once funds are placed in the account, they may be removed only under the following circumstances: (a) by the depositor or someone authorized by him, see…

We review the district court’s decision that appellants, the Secretaries of Health and Human Services and of the Treasury (“the government”), acted unlawfully in recouping social security benefits erroneously deposited by electronic fund transfer (“EFT”) into bank accounts held by appel-lees after the deaths of their husbands.

Facts

The three named plaintiffs, Berdie Thomas, Joy Nutter and Inez Poison, are widows whose husbands were receiving social security benefits at the time of their deaths. Pursuant to procedures established by the Social Security Administration (“SSA”) and the Department of the Treasury (“Treasury”), the recipients’ monthly social security benefits were paid directly into their bank accounts by EFT.

Upon the deaths of their husbands, each widow promptly notified SSA, closed the joint bank account she had shared with her husband, and requested that SSA deposit her own benefits into a new account. In each case, SSA failed to respond promptly to the notification and continued to pay benefits to the deceased husband. In Thomas’ case, her own benefits, as well as those erroneously certified to her husband, were deposited into a closed joint account for five…