Wheeler v. Montgomery Appendix

    APPENDIX

In the

^Supreme Court of the United States
October Term, 1968

No. 634

Mae W heeler, et al.
Appellants,

J ohn Montgomery, et al.
Appellees.

Appeal from the United States District Court 
for the Northern District of California

JURISDICTIONAL STATEMENT FILED OCTOBER 11, 1968 
PROBABLE JURISDICTION NOTED APRIL 21, 1969



I n the

Supreme Court of the Suited States
October Term, 1968

N o. 634

Mae W heeler, et al.
Appellants,

John Montgomery, et al.
Appellees.

Appeal from the United States District Court 
for the Northern District of California

JURISDICTIONAL STATEMENT FILED OCTOBER 11, 1968 
PROBABLE JURISDICTION NOTED APRIL 21, 1969

I N D E X

Page
Record from the United States District Court for the Northern 
District of California

Docket Entries .............................................................................  1
Complaint ....................................................................................  5
Affidavit of Mae Wheeler..........................................................  17



11 Index

Page
Supplemental Affidavit of Arthur C. Agnos in support of 

Temporary Restraining Order and Preliminary Injunction 19 
Temporary Restraining Order......................................................  23
Memorandum Opinion Permitting Class Action and Certifying 

Necessity of Convening Three Judge District Court...............  27
Answer Filed by Defendant Ronald Born.................................  34
Answer Filed by Defendant Montgomery and Exhibits Ap­

pended Thereto.................................. ......................................  36
Excerpt from Pre-Trial Order of Facts Admitted and at Issue 55
California State Department of Social Welfare, Regulation 

PSS 44-325. 43 Effective April 1, 1968.................. ..................  60
Memorandum Opinion and Order Dismissing Action................  62



IN THE UNITED STATES DISTRICT COURT 
FOR THE NORTHERN DISTRICT OF CALIFORNIA

Case No. 48303

DATE
1967

Nov. 30 

30
Dec. 1 

1 

1 

1 

1 

1 

1

6

7

Mae W heeler v . John Montgomery 

DOCKET ENTRIES 

FILINGS— PROCEEDINGS
1. Filed ord. permitting action to be filed in forma 
pauperis. Zirpoli
2. Filed complaint. Issued summons.
3. Filed motion by pltff. for temp, restrain, order, 
with supporting papers attached.
4. Filed motion by pltff. for prelim, injunc., with 
supporting affidavits attached.
5. Filed brief by pltff. supporting mos. for a temp, 
restrain, order and prelim, injunc.
6. Filed appli. by pltff. for convening of 3 Judge 
Court.
7. Filed memo by deft. Ronald H. Bom opposing 
mo. for a temp, restrain, order and prelim, injunc.
8. Filed declaration of Ronald H. Born on behalf of 
City and Co. of S.F. opposing mos.
Ord., aft. hrg., Court granted in part the appli, for 
a temp, restrain, order and prelim, injunc. and re­
stored pltff. to Welfare assistance aid effective Dec. 1, 
1967, as will more fully appear in findings and order 
to be presented by counsel for pltff.; the Court de­
ferred ruling for 30 days without prej. on pltff’s. mo. 
for the convening of a 3 Judge Court. (Zirpoli)
9. 12:34 P.M., Filed temporary restraining order. 
(Zirpoli)
10. Filed proof of service of summons & complt. on 
deft. John Montgomery, etc., Nov. 30, 1967.



2 Appendix

DATE
1967 FILINGS— PROCEEDINGS

11 11. Filed notice & Motion by Joseph Granatier and
Albert Curry, to intervene as pltffs., Dec. 20, 1967, 9 :45 
A.M., with supporting papers attached.

13 12. Filed notice & Motion by Virginia Hill to inter­
vene as party pltff., Dec. 20, 1967, 9 :45, A.M., before 
Judge Zirpoli, with supporting papers, attached.

15 13. Filed notice & Motion by pltff. for modification of
temp, restrain, order, Dec. 15, 1967, 9 :45 A.M. before 
Judge Zirpoli, with supporting papers attached.

15 Ord. pltff’s. mos. to intervene, for a 3 judge court, for 
a class action & to modify restraining order taken 
under submission; motions noticed for hrg. o'n Dec. 
20, & Jan. 2, 1968 ordered off calendar. (Zirpoli)

18 14. Filed motion by Lizzie Reeves for leave to inter­
vene as a party pltff. and for a temp, restrain, order, 
with supporting affidavit & memo.

18 Lodged temp, restrain, order.
18 Lodged intervenor’s complt. (See Sheet “ B ” )
20 15. Filed suppl. affidavit of Lizzie Reeves supporting

mo. for temp, restrain, order & mo. to intervene.
20 16. Filed affidavit of J. Gerald Mabey.
20 Ord., aft. hrg., Mo. of Lizzie Reeves to intervene as 

pltff. and for temp, restrain, order, denied without 
prej. (Zirpoli)

20 17. Filed Memorandum Opinion and order denying
continuance; partially vacating prior order; permitting 
class action; denying motions to intervene; denying mo. 
to modify temp, restrain, order; notification & certifi­
cation of necessity of 3 Judge Court. (Zirpoli) 
Copies mailed.

20 18. Filed notification and certificate to convene a
3 Judge Court. (Zirpoli)
Copies mailed to counsel & Judge Chambers, CCA.

26 19. Filed summons, on return.



Appendix 3

DATE
1967

26

29

DATE
1968

Jan. 4 
5

5

8

15

17

19

25

29

29

Feb. 6 
6 
6

FILINGS— PROCEEDINGS
20. Filed answer of deft. Ronald Born, indiv. and as 
Genl. Mgr. of San Francisco City & Co. Dept, of Social 
Services.
21. Filed order convening 3 Judge Court and desig­
nating Judges Oliver D. Hamlin, CJ; Albert C. Wol- 
lenberg and Alfonso J. Zirpoli, DJ’s. (Chambers, CJ)

3 Judge copies made & distributed.
22. Filed notice by pltff. of taking deps. of Frank 
Vasquez, Norman Clayton, & Wilbur L. Parker.
23. Filed notice by pltff. of taking dep. of Mary Jane 
Rand and issued subp.
24. Filed dep. subp. d.t., exec. Jan. 8, 1968, as to 
Mary Jane Rand.
25. Filed notice by pltff. of production of documents 
pursuant to subp., of a copy of the proposed decision 
in the Mae Wheeler Fair Hearing, etc. and issued subp.
26. Mailed notice of pre-trial conf. on Feb. 7, 1967, 
11:00 A.M. before Judge Zirpoli for sched. a time table 
for fur. pleadings, etc.; deft. John Montgomery is 
given to & inch Jan. 22, 1968 to file his answer or other 
pleadings. (Zirpoli)
Copies sent to Judge Hamlin & Judge Wollenberg.
27. Filed answer of John Montgomery, indiv. & as 
Director of the Calif. State Dept, of Social Welfare, 
with exh. attached.
28. Filed notice by pltff. of taking dep. of Dr. Scott 
Brier, Professor, School of Social Welfare, Berkeley, 
Calif. & iss. subp.
29. Filed stip. & order cont, pre-trial conf. to Feb. 14, 
1967, at 11:00 A.M. (Zirpoli)
30. Filed dep. subp. d.t., exec. Jan. 29, 1968, as to 
Scott Brier.
31. Filed deposition of Frank J. Vasquez.
32. Filed deposition of Wilbur L. Parker.
33. Filed deposition of Norman Clayton.



4 Appendix

DATE
1968

14
FILINGS— PROCEEDINGS

Ord., aft. pre-trial conf., a joint pre-trial order to be 
presented. (Zirpoli)

14 34. Piled additional statistical material in regard to 
the deposition of Wilbur L. Parker. (In brown envel­
ope)

14 35. Piled deposition of Mary Jane Rand, with statisti­
cal material in brown envelope attached.

23 36. Piled additional statistical material, as to the de­
position of Prank J. Vasquez. (In brown envelope in 
file)

Mar. 14 37. Piled notice of trial before 3 Judge Court, Apr. 
12, 1968, 10 A.M. in Courtroom No. 2; pltff’s. brief to 
be filed by Mar. 15, 1968; resps’ brief filed by Apr. 1, 
1968 (Clerk)

19 38. Piled brief in support of motion for preliminary 
injunction, etc.

20 39. Piled pre-trial order case will probably be set 
during week of April 8, 1968. (Zirpoli)

Apr. 1 
9

40. Piled defts’ reply trial brief.
41. Piled pltffs’ reply brief.

9 42., Piled pltffs’ Exhibit Number 1.
11 43. Piled list of documents described in pre-trial order, 

dated March 19, 1968, marked for identification and 
to be offered as pltffs’ exhibits in evidence.

11 44. Lodged order form. (Preliminary injunction)
12 Trial before 3 Judge Court, ordered case submitted. 

(Hamlin, Wollenberg, Zirpoli)
19 45. Piled memorandum opinion and order that this 

proceeding may, with propriety, now be dismissed. 
(Hamlin, CJ, Wollenberg, Zirpoli)

June 14 46. Piled notice of appeal by pltff. to the Supreme 
Court of the United States.

17 Mailed notice of filing notice of appeal.
July 15 Made, Mailed Record on Appeal Supreme Court of the 

U.S.



Appendix 5

In the United States District Court for the 
Northern District of California

No. 48303

Filed November 30, 1967, Clerk IT. S. District Court, 
San Francisco

[TITLE OMITTED IN PRINTING]

COMPLAINT FOR THREE JUDGE COURT, 
DECLARATORY JUDGMENT, AND 

INJUNCTIVE RELIEF

I
This is an action for injunctive and declaratory relief 

authorized by Title 42 U.S.C. 1983 to secure rights, privi­
leges and immunities established by the Fourteenth Amend­
ment to the Constitution of the United States and the 
Social Security Act, 42 U.S.C. 301, et seq., and the regula­
tions promulgated thereunder.

II
Jurisdiction is conferred on this Court by 28 U.S.C. 

1343(3) and (4) providing for original jurisdiction of this 
Court in suits authorized by 42 U.S.C. 1983; and jurisdic­
tion is further conferred on this court by 28 U.S.C. 2201 
and 2202 relating to declaratory judgments.

III
This is a proper case for determination by a three judge 

Court pursuant to Title 28 U.S.C. 2281 and 2284, in that 
it seeks an injunction to restrain the defendants from ap­
plying, enforcing, executing and implementing Sections



6 Appendix
12200, 12201 and 10950 of the California Welfare and 
Institutions Code (annexed hereto as Exhibit A ) and the 
regulations promulgated thereunder, insofar as these stat­
utes and regulations require termination, suspension or 
reduction of financial aid in the form of Old Age Security 
(OAS) prior to granting of notice and opportunity to be 
heard, on the grounds of the invalidity of said statutes and 
regulations under the Constitution and laws of the United 
States.

IV
This action seeks an injunction and declaratory judgment 

restraining the enforcement of and declaring unconstitu­
tional the aforesaid state statutes and state-wide regula­
tions, on their face and as applied and interpreted by 
defendants, on the grounds that said statutes and regula­
tions, and actions taken pursuant thereto, deny to plaintiffs 
the due process of law guaranteed by the Fourteenth 
Amendment to the United States Constitution and the 
“ fair hearing” guaranteed by the Social Security Act, in 
that said statutes and regulations deny to plaintiffs an 
opportunity for a hearing prior to termination and with­
drawal of financial aid under the OAS program.

V
Plaintiff Mae Wheeler is an adult citizen of the United 

States and a resident of the City and County of San 
Francisco, State of California.

VI
Plaintiff Wheeler brings this action pursuant to Rule 

23 of the Federal Rules of Civil Procedure on behalf of 
herself and all other recipients who are similarly situated. 
All OAS recipients are similarly affected by the statutes 
and regulations challenged herein in that all said recipients



Appendix 7
are by statute and regulation made subject to peremptory 
ex parte termination of their aid. The persons in the class 
are so numerous as to make joinder impractical; there are 
common questions of law and fact; plaintiff’s claims are 
typical of the claims of the class; and the representative 
party will fairly and adequately protect the interests of 
the class.

VII
Defendant John Montgomery is the Director of the Cali­

fornia Department of Social Welfare and is charged with 
statewide administration of the OAS program and with 
establishing rules and regulations to carry out the statu­
tory provisions of said program.

Defendant Ronald Born is General Manager of the San 
Francisco City and County Department of Social Services 
and is responsible for administration of the OAS program 
in the City and County of San Francisco, State of Cali­
fornia.

VIII
The OAS program created by Section 12000, et seq. of 

the California Welfare and Institutions Code, provides 
financial aid to persons over sixty-five years of age. Persons 
who meet the statutory criteria receive financial aid as a 
matter of statutory entitlement.

IX
At all times relevant hereto the State of California and 

defendants, in order to receive federal funds for the OAS 
program of the State of California, have been required by 
the Social Security Act, 42 U.S.C. § 301, et seq., to have 
formulated a “ state plan” for said program in conformity 
with the provisions of the Act and the United States Con­
stitution. The Social Security Act, 42 U.S.C. § 302(a) (4)



8 Appendix
as interpreted by regulations of the United States Depart­
ment of Health, Education and Welfare require that a 
“ state plan” provide for granting an opportunity for a 
fair hearing before the State agency to any individual 
aggrieved by an action of a County Department of Social 
Welfare.

X
Plaintiff Mae Wheeler is a seventy-five year old widow 

who had been receiving OAS continuously for thirteen 
years until her aid was terminated.

X I
Defendants have established plaintiff’s total monthly 

needs at $158.55. This figure includes plaintiff’s regular 
allotment for food, rent, clothing, transportation, and other 
necessities, plus added allowances for required telephone 
service ($2.70), laundry ($3.00), household remedies ($4.00) 
and a special medical diet ($11.35). Until September 1, 
1967, defendants had granted plaintiff $113.95 monthly; 
the remainder of plaintiff’s needs being met by monthly 
OASDI (Social Security) payments of $44.60. In addition, 
by virtue of her OAS eligibility, plaintiff was entitled to 
complete free medical treatment and hospitalization under 
the Medi-Cal program.

X II
Without prior notice defendants withheld plaintiff’s Sep­

tember 1,1967 OAS check.
X III

On or about September 14, 1967, defendants informed 
plaintiff that her OAS was being withheld because of plain­
tiff’s alleged transfer of approximately $4,000.00 in insur­
ance proceeds to her deceased son’s nephew in satisfaction 
of a pre-existing debt owed by her deceased son to said 
nephew.



Appendix 9
X IY

In September and October, 1967, plaintiff, assisted by a 
social worker from the Public Health Authority, attempted 
to have her OAS restored.

X V
By letter dated November 7, 1967, plaintiff was informed 

that her OAS was discontinued effective August 31, 1967. 
The basis of the discontinuance was ineligibility due to 
transfer of personal property with the intent to reduce 
plaintiff’s holdings to a sum within the maximum amount 
permitted to be retained by an OAS recipient. It was not 
and is not alleged that plaintiff had or has retained any 
money for her own use or benefit as a result of her son’s 
death.

X V I
On November 16, 1967, after seeking advice, plaintiff, 

through her authorized representative, filed an appeal and 
request for a hearing and a further request that her aid 
be restored and continued until a decision after hearing. 
(A  copy of plaintiff’s representative’s letter requesting 
restoration of aid is attached hereto as Exhibit B.) No 
answer to said letter has been received to date; aid has not 
been restored, nor has a hearing been scheduled.

X V II
At present, plaintiff has no assets to pay her December 

rent. Her total income (met through Social Security and 
the County General Assistance program) is projected at 
$98.50 per month, although defendants have calculated 
plaintiff’s minimum needs to be $158.55 monthly. To date, 
plaintiff has only received a $15.60 emergency food order 
under the General Assistance program.



10 Appendix
X V III

Plaintiff is in extremely poor health and was hospitalized 
on or about November 26, 1967. No money for plaintiff’s 
medical expenses or special medical needs is now being 
granted.

X IX
Section 10950 of the California Welfare and Institutions 

Code, prescribing the hearing procedure in the OAS pro­
gram, and Sections 12200 and 12201 prescribing the manner 
of termination or reduction of aid in the OAS program 
on their face and as interpreted and applied to plaintiff 
and members of her class, violate the rights of due process 
of law guaranteed by the Fourteenth Amendment to the 
United States Constitution and the “ fair hearing” guaran­
teed by the Social Security Act in that said statutes and 
the regulations adopted in enforcement thereof authorize 
and require effective action terminating, suspending and 
revoking financial aid prior to the granting of reasonable 
notice and opportunity for a hearing. The termination and 
withdrawal of financial aid may, under the regulations, 
extend for a period of several months before a hearing is 
held and a decision is rendered, even though plaintiff had 
been receiving such aid and is in vital need of such aid for 
food and shelter and medical care and even though plaintiff 
is prepared to prove that she is and has been eligible.

X X
Plaintiff has no adequate remedy at law and defendants 

will continue, to cause plaintiffs irreparable injury unless 
enjoined by this Court.

Wherefore, plaintiff respectfully prays on behalf of her­
self and others similarly situated, that this Court:



Appendix 11
1. Assume jurisdiction of this cause and convene a 

three judge Court pursuant to Title 28 U.S.C. § 2281.
2. Enter a temporary restraining order and a prelimi­

nary injunction ordering the defendants to grant plaintiff’s 
request for restoration and continuation of aid until the 
holding of a hearing and the issuance and implementation 
of a decision by the State Department of Social Welfare, 
or until the determination of this cause.

3. Enter a declaratory Judgment pursuant to Title 28 
U.S.C. 2201, 2202 and Rule 57 of the Federal Rules of Civil 
Procedure declaring that Sections 10950, 12200 and 12201 
of the California Welfare and Institutions Code and the 
regulations issued pursuant thereto violate the Fourteenth 
Amendment to the United States Constitution and the So­
cial Security Act on their face and as applied, insofar as 
they authorize and require termination, suspension or revo­
cation of aid prior to granting reasonable notice and oppor­
tunity for a hearing.

4. Enter a preliminary and permanent injunction re­
straining the defendants, their successors in office, agents 
and employees from terminating, suspending or revoking 
the aid of any OAS recipient prior to the granting of 
reasonable and adequate notice and opportunity for a hear­
ing which satisfies the standards of due process of law.



12 Appendix
5. Allow plaintiff her costs herein, grant her and all 

others similarly situated such additional or alternative re­
lief as the Court may deem to be just and appropriate.

Respectfully submitted,

P eter E. Sitkin 
Stafford Smith '
ISIDOOR B oRNSTEIN 
Gilbert Graham 
1095 Market Street, Suite 312 
San Francisco, California 94103 
Telephone: (415 ) 626-3811
Attorneys for Plaintiffs

Steven A ntler

2701 Folsom Street
San Francisco, California 94110

B rian Glick 
Henry F reedman 
401 West 117th Street 
New York, New York 10027
Of Counsel



STATUTES

California W elfare and Institutions Code:

Section 12200. Grounds; report of suspension; effect of 
eligibility for medical assistance. The county may for 
cause, and upon instructions so to do by the department, 
shall cancel, suspend, or revoke aid. Upon request of the 
department, an immediate report of every suspension shall 
be made to the department stating the reason for the sus­
pension and showing the action of the board of supervisors 
in approving the suspension.

Eligibility for medical assistance for the aged does not 
constitute cause for retroactive cancellation, suspension, or 
revocation of aid.
Section 12201. Notice to recipient. I f the board of super­
visors, in accordance with Section 12200, cancels, suspends, 
or revokes aid, the recipient shall be immediately notified 
in writing of the county’s action, the date thereof, and of 
the reason therefor and the recipient’s right to appeal there­
from.
Section 10950. Opportunity; recipient defined. I f any ap­
plicant for or recipient of public social services is dissatis­
fied with any action of the county department relating to 
his application for or receipt of aid or services, or if 
his application is not acted upon with reasonable prompt­
ness, or if any person who desires to apply for such aid 
or services is refused the opportunity to submit a signed 
application therefor, and is dissatisfied with such refusal, 
he shall, in person or through an authorized representative, 
without the necessity of filing a claim with the board of 
supervisors, upon filing a request with the department, be 
accorded an opportunity for a fair hearing.

As used in this chapter, “ recipient” means an applicant 
for or recipient of aid or services except aid or services 
exclusively financed by county funds.

Appendix 13

E X H I B I T  A  (to  com p la in t)



14 Appendix
E X H I B I T  B  (to  com p la in t)

November 16, 1967

State Department of Social Welfare 
Fair Hearing Section 
1407 Market Street 
San Francisco, California 94103

R e : Mrs. Mae Wheeler 
1855 15th Street 
San Francisco, California 
OAS #38-10-56380

Gentlemen:

Mrs. Wheeler has authorized me to represent her in her 
request for a Fair Hearing and in other proceedings neces­
sary to have her Old Age Security payments immediately 
re-instated.

Since September 1, 1967, Mrs. Wheeler has not received 
any old age assistance because the local Social Services 
Department ruled that she transferred some of her deceased 
son’s property in order to qualify for aid. This decision is 
contrary to the facts and a misapplication of the law and 
regulations—I request an immediate fair hearing.

As you should be aware, Mrs. Wheeler is 75 years old, and 
in extremely poor health. Her regular assistance budget 
includes money for a special diet as well as other vital 
additional items. At the present time, my client must live 
on Social Security payments of $44.00 monthly. She has 
no other income or assets. I hereby request that your de­
partment grant Mrs. Wheeler continued full assistance 
pending the decision of the fair hearing— she cannot sur­
vive without this money.



By letter dated November 7, 1967, Mrs. Wheeler was in­
formed that her grant was discontinued effective August 
31,1967, because of “ ineligibility due to transfer of personal 
property.” On November 1, 1967, she had been informed 
by letter that “ Your September and October, 1967, warrants 
which were withheld, will be decreased to zero because of 
lump sum death benefits received by beneficiary which re­
sulted in overpayments in August and September.” Mrs. 
Wheeler had first discovered that her eligibility was ques­
tioned when she inquired why she had not received her 
regular September 1st check.
The San Francisco Department challenges Mrs. Wheeler’s 
payment to her grandson, Bobby Lee Wheeler of the pro­
ceeds of a Veterans Insurance Poliey left by her son, R. L. 
Wheeler who died February 5, 1967. There is no question 
that the policy was actually paid to Bobby Lee Wheeler, 
and that Mrs. Wheeler no longer has any money remaining.
The Department relies on Section 41-321.321, PSS Manual 
[Applicant or Recipient Unable to Account for Disposition 
of Property], as the basis of its action. Assistance was dis­
continued in spite of Mrs. Wheeler’s explanation that her 
son while in the hospital following his heart attack made 
her promise to pay the policy over to his nephew. Mrs. 
Wheeler has supplied the Department with two affidavits 
from her grandson explaining in detail the circumstances of 
the original loan and the arrangements for its repayment 
as well as her own four page affidavit on this subject.

Section 41-321.1 PSS Manual states:
Although only the person concerned can state what 
his intent was in transferring property, his actions 
can support or contradict such statement and his real 
intent can he determined only by consideration of all 
the facts, (emphasis added)

Appendix 15



16 Appendix
Here all the facts clearly substantiate Mrs. Wheeler’s claim 
and rebute any possible presumption that she was attempt­
ing to illegally remain eligible for assistance.

Additionally, the Department’s reduction to zero of Mrs. 
Wheeler’s September and October grant is violative of the 
law. Appellant also reserves her rights to present all rele­
vant testimony and argument challenging every aspect of 
the local department’s action of suspending, reducing and 
discontinuing her grant.

Mrs. Wheeler stated in her October 18th letter (accompany­
ing the material she submitted to her social worker), “my 
situation has become desperate as I do not have enough 
money to live on without my OAS grant.” As Mrs. Wheeler 
has a constitutional right to a hearing prior to discontinuing 
of her old age assistance, immediate resumption of assist­
ance prior to the hearing is required.

If I do not hear from you within one week, I will be forced 
to resort to court action.

Sincerely,

Marvin S. K ayne 
Attorney at Law

B y ......................................................
Steven J. A ntler

SJA/aee
CC: Commissioner John Montgomery

A uthorization

I hereby authorize as my representatives in connection with 
this welfare appeal: Marvin S. Kayne, Esq., Peter E. Sitkin, 
Esq., and Mr. Steven J. Antler, 2701 Folsom Street, San 
Francisco, California.

Dated: November 16, 1967.

, /s / Mrs. Mae W heeler

Mrs. Zulma Mae Wheeler



In the United States District Court for the 
Northern District of California

[TITLE OMITTED IN PRINTING]

AFFIDAVIT IN SUPPORT OF MOTION 
FOR TEMPORARY RESTRAINING ORDER 

AND PRELIMINARY INJUNCTION

State of California
City and County of San Francisco—ss.

Mrs. Mae Wheeler, having been duly sworn, deposes 
and says:

1. I am the plaintiff in the above-entitled action.
2. I am a 75 year old widow who regularly resides at 

1855 - 15th Street, City and County of San Francisco, a 
Public Housing Project for the elderly.

3. For approximately the last ten years my sole source 
of support has been Old Age Security (OAS) and Social 
Security (OASDI) payments.

4. My last OAS check came on about August 1, 1967, 
and I haven’t received any money under the OAS program 
since that date.

5. The reasons given for terminating my OAS are com­
pletely untrue. I transferred my deceased son’s insurance 
policy to his nephew to satisfy my son’s debt. I never in­
tended to affect my OAS eligibility. Through my repre­
sentative, I requested continued OAS assistance until I 
could vindicate myself at a fair hearing.

6. I was living on my allowable reserve income and my 
Social Security payments ($44.60 monthly) until about No­
vember 10, 1967, when I ran completely out of funds.

Appendix 17



18 Appendix
7. On or about November 25, 1967, I finally received an 

emergency food order for $15.60 and have been promised 
$43.90 monthly from the County General Assistance 
Program.

8. I have no money whatsoever on hand now. I can’t 
pay my December rent of $49 or buy any household or other 
items I need.

9. I am a diabetic who needs a special diet of foods such 
as meats and sugar free fruits, which are much more ex­
pensive than regular foods. I have difficulty buying these 
items on my full OAS budget.

10. I also suffer from heart disease and high blood 
pressure. I am currently confined to Hahnemann Hospital 
on doctor’s orders as a result of my many ailments, but I 
expect to be released from the hospital within the next few 
days.

11. I am extremely worried and nervous because I don’t 
know how I  can possibly live without my full OAS grant.

/ s /  M bs. Mae W heeler

Mrs. Mae Wheeler, Affiant



Appendix 19

In the United States District Court for the 
Northern District of California

[TITLE OMITTED IN PRINTING]

SUPPLEMENTAL AFFIDAVIT IN SUPPORT
OF MOTION FOR TEMPORARY RESTRAINING 

ORDER AND PRELIMINARY INJUNCTION

State of California
City and County of San Francisco—ss.

A rthur C. A gnos, being duly sworn, deposes and says:
I received a Master of Social Work Degree (MSW) in 

April, 1966. I have been Assistant Director of Human Re­
lations and Social Services with the San Francisco Public 
Housing Authority since September, 1966.

Mrs. Mae Wheeler was referred to my office by one 
of the Housing Authority’s Review Clerks. When she saw 
the Review Clerk, she expressed concern about not receiving 
her OAS check.

Mrs. Wheeler called my office on September 14, 1967, 
claiming that she had not received her OAS check and her 
situation was becoming more and more desperate. She 
seemed extremely anxious and was crying. I reassured her 
that I would help her and would call the Department of 
Social Services.

On the same day, September 14, I called Mrs. Wheeler’s 
welfare worker, Mrs. Geraldine Palmer, and asked for 
clarification of the situation. She explained that Mrs. Wheel­
er’s check had been suspended until an investigation could 
be made. She told me that, since I was not Mrs. Wheeler’s 
representative, she could not discuss the case with me. How-



20 Appendix
ever, she did tell me that the Department had received an 
anonymous phone call telling them that Mrs. Wheeler had 
received an inheritance and should not be receiving welfare 
assistance. I asked why Mrs. Wheeler had not been told 
this and she explained that she had been away on vacation 
and had just returned to a pile of work. I stressed the fact 
that Mrs. Wheeler was an emergency situation and merited 
immediate attention. I strongly questioned the fact that the 
OAS check had been cut off on the basis of an anonymous 
phone call without any discussion with Mrs. Wheeler. I 
demanded immediate action to correct the situation. The 
welfare worker said that she would see what she could do.

Shortly after my telephone conversation with the welfare 
worker, I received a call from her supervisor, Mrs. Ream, 
who questioned my involvement in the case. I explained that 
part of my job as a social worker with the Housing Author­
ity often necessitated helping Housing Authority residents 
with welfare problems. More specifically, Mrs. Wheeler had 
requested that I act in her behalf as she was at a loss as 
to what to do.

The supervisor refused to discuss the case with me stat­
ing that the problem was between the Department and the 
Recipient and the Department would take it up “ in our good 
time.”  I refused to accept the statement that the Department 
would take the situation up “ in our good time” as I was 
acutely aware of Mrs. Wheeler’s increasingly desperate con­
dition. I  again strongly disagreed with the way in which 
Mrs. Wheeler had been treated on the basis of an anonymous 
phone call. I insisted that something be done immediately to 
correct the situation. The supervisor explained that the 
assigned worker had been on vacation and could not see Mrs. 
Wheeler. I questioned delaying action on a matter which in­
volved the major part of a 75 year old ill woman’s income, 
and that I was not satisfied with the situation.



Appendix 21
I immediately called Miss Trudy Kanner, Supervisor of 

the Community Services Division, explained the situation 
and requested an immediate opportunity to do something to 
get Mrs. Wheeler’s aid restored. She agreed to look into the 
matter immediately. Shortly thereafter Miss Kanner called 
back to tell me that we would have the opportunity on Mon­
day, September 18.

I arranged for Mrs. Wheeler to sign a “ release of informa­
tion” in order that the Department would discuss the case 
with me. On Friday, September 15, I was present during a 
home visit by the welfare worker who told us what state­
ments were needed. Over the weekend I helped Mrs. Wheel­
er gather and prepare the required information.

On Monday, September 18,1 appeared with Mrs. Wheeler 
and a relative at the Department of Social Services. We 
were met by Mrs. Wheeler’s welfare worker and a man who 
was introduced as a representative from the County Fail- 
Hearings Section. I presented the prepared statements to 
the welfare worker who briefly scanned them. Mrs. Wheeler 
stated that she had not intended to deceive the Department, 
but was only carrying out her late son’s dying wish. Mrs. 
Wheeler asked when her aid would be restored. The wel­
fare worker replied that at this meeting she could only re­
ceive the prepared statements from us. In turn, she would 
forward them to administrative superiors for a decision. 
Mrs. Wheeler asked how long it would take for a decision. 
The representative from Fair Hearing Section stated that 
she would be notified about the decision. I asked the repre­
sentative what his role was in today’s meeting. He answered 
that he was only present as an “ observer.” This entire meet­
ing lasted approximately ten minutes and absolutely no 
decision was rendered. It was only to present the prepared 
statements to the welfare worker,



22 Appendix
On September 22, I called the welfare worker to learn of 

any decision. She informed me of additional information 
which was required to amplify on the earlier statements. A. 
letter was received outlining the additional information re­
quired. I immediately set about compiling the considerable 
amount of additional information. This involved writing to 
Texas for a statement from another ill son, supplemental 
statements from a nephew, driving to Milpitas with Mrs. 
Wheeler to try to determine the disposition of a home pur­
chased by her deceased son in 1962.

On October 16, 1967, Mrs. Wheeler presented the addi­
tional information required to the welfare worker.

On October 19, 1967, the welfare worker telephoned Mrs. 
Wheeler and me to inform us that her OAS grant had been 
restored. She told me that there had been a transfer of funds 
but it was not considered intentional, and the aid was to be 
restored.

On October 23, 1967, another phone call from the welfare 
worker informed Mrs. Wheeler and me that the aid was not 
to be restored. The decision had been reversed by admin­
istrative higher ups. She suggested that Mrs. Wheeler could 
request a fair hearing.

At this point I felt I had exhausted all of my professional 
resources. I  recommended to Mrs. Wheeler that we apply 
for legal assistance from the San Francisco Neighborhood 
Legal Assistance Foundation.

/s /  A rthur C. A gnos

Arthur C. Agnos



Appendix
TEMPORARY RESTRAINING ORDER

23

In the United States District Court 
for the Northern District of California, Southern Division

Civil Action No. 48303

Mae W heeler, et al., 

v.

John Montgomery, et al.,

Plaintiffs,

Defendants,

TEMPORARY RESTRAINING- ORDER
The plaintiffs have filed this action to declare uncon­

stitutional California Welfare & Institutions Code Sec­
tions 12,200, 12,201 and 10,950, which authorizes the ter­
mination, suspension or revocation of financial aid under 
the Old Age (OAS) program prior to the granting of 
reasonable and adequate notice and opportunity for a hear­
ing. They have made application for the hearing of this 
cause for a declaratory judgment, preliminary and per­
manent injunction before a Three-Judge District Court 
pursuant to Title 28, United States Code, Sections 2281 
and 2284.

This action coming on to be heard on December 1, 1967, 
on the motion of plaintiffs for a temporary restraining 
order, and adequate notice having been given to defend­
ants; and the Court having considered the affidavits and 
memoranda presented and the arguments of counsel for 
all parties, and being fully advised in the premises, it makes 
the following findings of fact and conclusions of law:



,24 Appendix
FINDINGS OF FACT

1. Defendants withheld and thereafter terminated plain­
tiff Mae Wheeler’s aid under the OAS program without 
affording her reasonable notice and an opportunity for a 
prior hearing.

2. Plaintiff Mae Wheeler’s minimum monthly need as 
of August 31, 1967 was determined by defendants to be 
$158.55 and was met through direct Social Security benefits 
of $44.60 and an Old Age Security grant of $113.95. As a 
consequence of the termination of Old Age Security, she 
now has been promised County General Assistance in the 
sum of $53.90 a month which, when added to her direct 
Social Security payments totals $98.50 a month.

3. Defendants have refused plaintiff Mae Wheeler’s 
request for restoration and continuation of aid under the 
OAS program.

4. Defendants’ withdrawal and termination of aid and 
their continued refusal to reinstate plaintiff Mae Wheeler’s 
aid has caused and is causing plaintiff Mae Wheeler imme­
diate and irreparable injury in that she will not have suffi­
cient funds with which to subsist on a day-to-day basis 
without her full OAS payment.

5. Irreparable injury has been shown only with respect 
to plaintiff Mae Wheeler and no proof so far has been pre­
sented of any others in the class who are likely to suffer 
immediate and irreparable injury.

CONCLUSIONS OF LAW
Defendants’ termination of plaintiff Mae Wheeler’s aid 

under the OAS program pursuant to California Welfare & 
Institutions Code Sections 12,200 and 12,201 and the regu­
lations promulgated thereunder without a prior hearing



Appendix 25
and reasonable notice raises a substantial question as to 
whether the due process clause of the Fourteenth Amend­
ment to the U.S. Constitution has been violated.

Upon the foregoing, it is, by the United States District 
Court for the Northern District of California, Southern 
Division, this 1st day of December, 1967

ORDERED:

1. That the defendants John Montgomery and Ronald 
Born, their agents, servants, and employees be, and they 
are hereby restrained effective December 1, 1967 from 
enforcing against the plaintiff Mae Wheeler the provisions 
of the California Welfare and Institutions Code Sections 
12,200, 12,201, and 10,950, et seq., and implementing the 
Rules and Regulations of the State Department of Social 
Welfare, so that Old Age Assistance shall be restored to 
plaintiff Mae Wheeler forthwith in the amount to which 
she may be found eligible in order to meet her needs as 
established under the Old Age Security program until such 
time as a determination is made by this Court regarding 
plaintiff’s application for convening a Three-Judge Court 
pursuant to Title 28 U.S.C. 2281 and 2284.



26 Appendix
2. That action on plaintiff’s application for the conven­

ing of a Three-Judge Court shall be deferred for 30 days 
until January 2, 1968, at 5 p.m. without prejudice to any 
of the parties herein.

A lfonso J. Zirpoli 

District Court Judge

Signed on December 6,1967.

APPROVED AS TO FORM :
T homas C. Lynch 
Attorney General

By E lizabeth P almer

Deputy Attorney General
Attorneys for Defendant 

J ohn Montgomery

T homas M. O’Connor,
City Attorney

By......................................................
Raymond D. Williamson, Jr.
Deputy City Attorney

Attorneys for Defendant Ronald Born



Appendix 27
MEMORANDUM ©PINSON PERMITTING CLASS ACTION AND 

CERTIFYING NECESSITY OF CONVENING THREE-JUDGE 
DISTRICT COURT.

United States District Court 
For the Northern District of California 

No. 48303

Mae Wheeler, individually and on behalf 
of all others similarity situated,

Plaintiffs,
vs.

John Montgomery, individually and in his 
capacity as Director of the California 
State Department of Public Welfare, 
and Ronald Born, individually and in 
his capacity as General Manager of the 
San Francisco City and County Depart­
ment of Social Services,

Defendants.

MEMORANDUM OPINION AND ORDER DENYING 
CONTINUANCE, ORDER PARTIALLY VACAT­
ING PRIOR ORDER, ORDER PERMITTING 
CLASS ACTION, ORDER DENYING MOTIONS 
TO INTER VENE, ORDER DENYING MOTION TO 
MODIFY TEMPORARY RESTRAINING ORDER, 
NOTIFICATION AND CERTIFICATION OF 
NECESSITY OF THREE JUDGE COURT.

FACTS AND PROCEEDINGS TO DATE
Plaintiff has filed a complaint, in forma pauperis, seeking 

injunctive and declaratory relief against a California wel­
fare practice authorized by state statutes which permit the 
termination of old age security benefits prior to affording 
the recipient a hearing on his supposed ineligibility. The



28 Appendix
statutes which are involved are CAL. W ELF. & INST. 
CODE §§ 12,200, 12,201. The complaint is in the form of 
a class action.

The facts alleged pertaining to the named plaintiff are 
as follows: As of August 30,1967, Mrs. Wheeler was receiv­
ing old age benefits in the amount of $113.95. Defendants 
received information that Mrs. Wheeler had received some 
$6,000.00 in insurance proceeds and had transferred the 
money to her grandson. Defendants determined that Mrs. 
Wheeler’s alleged action rendered her ineligible for con­
tinued benefits because she had had more money than the 
maximum permitted while maintaining eligibility.

Mrs. Wheeler’s benefit cheeks had, at the time the suit 
was filed, been withheld since September 1, 1967, although 
she came to receive general assistance in the amount of 
$53.90 until December 1, 1967, the date on which this court 
heard argument on the propriety of a temporary restrain­
ing order restoring old age benefits and on the need for a 
three judge court.

On December 6, 1967, this court issued a temporary re­
straining order to avoid irreparable injury to Mrs. Wheeler, 
the court having been satisfied by plaintiff’s showing that 
such injury was occurring. The court also stayed further 
proceedings for thirty days to permit Mrs. Wheeler to 
appeal to a state referee to adjudicate her dispute with the 
County of San Francisco.

Prior orders in no way were a determination of the merits 
of plaintiff’s claims, but merely endeavored to preserve 
the status quo pending the court’s determination of the 
questions involving a three judge court and a class action. 
The court recognizes that the result of the appeal will in 
no way affect the existence of a case or controversy be­
tween the parties over the constitutionality of the statutes



Appendix 29
here challenged. No restraining order was issued applicable 
to any other member of the alleged class because no show­
ing was made of an imminent threat of irreparable harm. 
The court expressly allowed appropriate showing to be 
made as instances of threatened irreparable harm arose.

Since December 6, 1967, plaintiff’s counsel have made 
motions for intervention and a motion for modification of 
the temporary restraining order to include the entire alleged 
class. The court deems the showings made with respect to 
persons other than Mrs. Wheeler inadequate to warrant 
further injunctive relief at this time.

Defendants’ counsel have requested a continuance of the 
argument scheduled on some of the motions and on the 
questions of the three judge court and class action. Having 
heard further argument on December 15, 1967, the court 
deems that no continuance is necessary, that the pleadings 
constitute a more-than-adequate record on which to base 
rulings on the matters now pending before the court, and 
that the court’s duty is to determine certain of the questions 
involved by referring to the complaint in this action. The 
court is satisfied that any previous stay of these proceed­
ings to permit further argument has been rendered unneces­
sary by the court’s own examination of the issues involved 
in this case and by further argument and documents filed 
by the parties.

JURISDICTION: NEED FOR A THREE JUDOE
COURT
Plaintiff’s basic contention is that to terminate old age 

benefits without first giving the recipient a hearing is to 
deny a recipient due process of law. Plaintiff contends that 
the right to a hearing prior to termination may be found 
either in the due process clause, U.S. Const., amend. 14,



3G Appendix
or in portions of the Social Security Act, specifically 42 
U.S.C. § 1382(a)(4) and certain regulations promulgated 
pursuant thereto. Plaintiff’s attack is merely on the proce­
dural method by which aid is terminated. She disclaims 
any contention that under the facts as alleged by defend­
ants to exist, aid may not be terminated. She merely says 
that a hearing on the question of eligibility must be held 
prior to the termination.

Actually, three potential constitutional challenges lurk 
in the pleadings of this case: (1) California’s termination 
statutes are repugnant to the due process clause of the 
fourteenth amendment; (2) California’s termination stat­
utes are repugnant to provisions of the Social Security 
Act; (3) if  California’s termination statutes are not repug­
nant to the Act, the Act is repugnant to the due process 
clause of the fifth amendment. While the second enumerated 
contention does not require a three judge court, Swift & 
Co., Inc. v. Wickham, 382 U.S. 111 (1965), the first and 
third do, 28 U.S.C. §§ 2281, 2282.

The requirements of § 2281 are satisfied in this case: 
a state statute is challenged as repugnant on its face to 
the federal constitution; an injunction is sought; a state 
officer is a defendant ; the statute has statewide application.

This court cannot say the federal question presented is 
not substantial in the sense that term is used with reference 
to the propriety of a three judge court. Just “ how much 
due process” is required is a difficult question to decide when 
administrative proceedings are involved. Also, the precise 
question presented—whether a hearing prior to adminis­
trative action is required—is a difficult question which has 
engendered considerable debate and litigation. Though not 
resolved, a situation strikingly similar to the one in this 
ease has been presented to and reached the Supreme Court. 
Thorpe v. Housing Authority of the City of Durham, 386 
U.S. 670 (1967).



Appendix 31
Recent years have seen an increasing number of deci­

sions dealing with the question of public entities attempting 
to terminate “benefits” without hearings. E.g., Slochower v. 
Board of Higher Education of New York City, 350 U.S. 
551 (1956); Wasson v. Trowbridge, 382 F. 2d 807 (2d Cir. 
1967); Dixon v. Alabama State Board of Education, 294 
F. 2d 150 (5th Cir. 1961), cert, denied, 368 U.S. 930 (1961); 
Teel v. Pitt County Board of Education, 272 F. Supp. 703 
(E.D. N.C. 1967). But cf., e.g., Cafeteria & Restaurant 
Workers Union v. McElroy, 367 U.S. 886 (1961); Vitarelli 
v. Seaton, 359 U.S. 535 (1959). See also 1 Davis, Adminis­
trative Law §§ 7.04-7.20; Silver, How to Handle a Welfare 
Case, 4 Law in Trans. Q. 87, 100 n. 54 and accompanying 
text (1967); Note, Federal Judicial Review of State Wel­
fare Practices, 67 Colum. L. Rev. 84, 93 (1967). Based on 
a review of the above and other authorities, this court must 
conclude that the precise federal question presented by 
this case is substantial and that a three judge court is 
required to ultimately dispose of the issues.

CONSIDERATIONS PERTAINING TO A CLASS 
ACTION
The prayer for declaratory and injunctive relief raises 

common issues of law for each member of the class; namely, 
whether a termination of benefits without a prior hearing 
denies a recipient his rights under the United States Con­
stitution. All members of the class are governed by the 
same California procedures and statutes.

The court concludes that the prerequisites of Fed. R. 
Civ. P. 23(a) are satisfied. Similarly, the requirement of 
Fed. R. Civ. P. 23(b) (2) is satisfied.

The foregoing memorandum opinion and the orders 
which follow dispose of the matters presently scheduled



32 Appendix
to be beard on January 2,1968, and of all other preliminary 
matters now pending before this court. Hence, absent fur­
ther pleadings by the parties, no further action or appear­
ances will be required of the parties prior to the convening 
of the three judge court.

ORDERS
1. The court being satisfied that a continuance would 

serve no useful purpose in disposing of the merits of this 
case, It Is Ordered that defendants’ motion for a contin­
uance is denied.

2. The court being, satisfied that further delay in the 
resolution of pending matters would not aid the court in 
ruling on such matters, and the court having examined the 
pleadings and authorities relevant to the rulings made this 
day, It Is Ordered that any prior order of this court is 
vacated to the extent such order stayed further proceedings 
preliminary to the court’s ruling on any matter ruled upon 
this day.

3. Pursuant to Fed. R. Civ. P. 23(a), (b )(2 ), (c)(1 ), 
and (d )(2 ), It Is Ordered that a class aetion for declara­
tory and injunctive relief may be maintained, the class to 
consist of all recipients of old age benefits subject to Cali­
fornia termination statutes, and that plaintiff shall forward 
to the United States Attorney at San Francisco and to the 
Secretary of the Department of Health, Education and 
Welfare, notice of the pendency of this action, together 
with a copy of the pleadings heretofore filed with the court 
and with a copy of this memorandum opinion and these 
orders.

4. The court being satisfied that the showings hereto­
fore made on behalf of the putative intervenors are not 
substantial enough to require intervention, and the court



Appendix 33
being satisfied that the rights of all members of the class 
will be protected without the intervention, It Is Ordered 
that all motions to intervene on, file on the date of this 
order are denied.

5. The court being satisfied that the showings hereto­
fore made in support of the motion to modify the tempo­
rary restraining order are insufficient to justify further 
injunctive relief at this time by this court, It Is Ordered 
that the motion to modify the temporary restraining order 
is denied without prejudice to such reconsideration as may 
be appropriate of requests for interim relief.

6. The court will notify the chief judge of the ninth 
circuit that in this court’s opinion a three judge court is 
required to resolve the issues in this case.

Dated: December 20,1967

A lfonso J. Zirpoli 

United States District Judge
Filed Feb. 20, 1967



■ In the United States District Court 
for the Northern District of California

[TITLE OMITTED IN PRINTING]

ANSW ER TO COMPLAINT
Comes now the defendant RONALD BORN, individually 

and in his capacity as General Manager of the San Fran­
cisco City and County Department of Social Services, and 
answering, the complaint of plaintiffs on file herein, admits, 
denies and alleges as follows:

I
Denies each and every, all and singular, generally and 

specifically, the allegations contained in paragraphs I, II, 
III, IV, VI, X , XI, XII, X III, XV, XVI, XVII, XVIII, 
X IX  and X X  of said complaint.

II
Answering the allegations of paragraph X IV  of said 

complaint this answering defendant states that he has no 
information or belief upon the subject sufficient to enable 
him to answer any of the said allegations, and placing his 
denial on that ground, this defendant denies each and every, 
all and singular, generally and specifically, said allegations.

III
Answering the allegations of paragraph V II of said com­

plaint, Ronald Born states that he is the Director of the 
Department of Social Services for the City and County 
of San Francisco.

IV
Answering the allegations of paragraph IX  of said 

complaint, this defendant admits that, in accord with due 
process, a “ fair hearing” is afforded any recipient who feels

34 Appendix



Appendix 35
aggrieved by a decision to terminate aid, and Mae Wheeler 
received suck fair hearing, on December 22, 1967.

V
Further answering the allegations of paragraph X  of 

said complaint, this defendant states that plaintiff has been 
a recipient of old age security for a period of about ten 
(10) years.

VI
Further answering the allegations of paragraph X II of 

said complaint, this defendant states, on information and 
belief, that plaintiff was contacted by telephone on August 
30, 1967, and, in that telephone conversation, admitted re­
ceiving and subsequently transferring funds received due 
to the death of her son; that plaintiff had not notified 
the Department of Social Services of the existence or dis­
position of these funds; and that no check was withheld 
until after plaintiff had admitted receiving and disposing 
of funds received due to the death of her son.

VII
Further answering the allegations of paragraph X V I 

of said complaint, this defendant states that a fair hearing 
was conducted on December 22, 1967, and plaintiff has 
been mailed her December check for Old Age Security.

Wherefore, defendant prays that plaintiffs take nothing 
by their complaint on file herein, that said defendant have 
judgment for his costs of suit herein incurred and for such 
other and further relief as to the court may seem proper.

Dated: December 26, 1967.
T homas M. 0 ’Connor

City Attorney

R aymond D. W illiamson, Jr.
Deputy City Attorney



In the United States District Court 
for the Northern District of California

[TITLE OMITTED IN PRINTING]

Civil Action No. 48303

ANSW ER TO COMPLAINT
Comes now the defendant John Montgomery, individu­

ally and in his capacity as Director of the California State 
Department of Social Welfare and answering the complaint 
of plaintiffs on file herein, admits, denies and alleges as 
follows:

I
Denies each and every, all and singular, generally and 

specifically the allegations contained in paragraphs I, II, 
III, IV, VI, XI, XVII, X V III and X X  of said complaint.

II
Admits the allegations contained in paragraphs V, VII, 

VII, IX  and X IV  of said complaint.

III
Denies the allegations contained in paragraph X  and 

alleges that plaintiff is a 75 year old widow who had been 
receiving Old Age Security continuously and in varying 
amounts since December 1959 to supplement her social 
security benefits which she currently receives in the amount 
of $44.60 per month.

IV
Answering the allegations contained in paragraphs X II 

and X III of the complaint, this defendant is informed and 
believes and on the basis of such information and belief 
alleges that plaintiff was contacted by defendant county 
on August 30, 1967, and, in that telephone conversation

36 Appendix



Appendix 37
plaintiff admitted receiving and subsequently transferring 
the proceeds of a check in the sum of $4,582.15 to her 
grandson, Bobby Lee Wheeler. On the basis of such infor­
mation and belief defendant further alleges that no Old 
Age Security check was withheld until after plaintiff had 
admitted receiving and disposing of said funds over six 
months previously and without at any time having, notified 
defendant county of her receipt or transfer of said funds.

Defendant further alleges that while withholding plain­
tiff’s Old Age Security check defendant county granted 
general assistance funds to plaintiff.

y
Denies the allegations contained in paragraphs X V  and 

alleges that on or about November 2, 1967, defendant 
county took the following actions with respect to plaintiff:

1. Discontinued Old Age Security, effective August 31, 
1967, and cancelled the subsequently withheld warrants, 
and

2. Requested repayment of all Old Age Security paid 
to the claimant for the period May 1 through August 31, 
1967.

VI
Admits the allegations contained in paragraphs IX  and 

X V I and alleges that the hearing referred to in said para­
graphs came on for hearing on December 22, 1967.

That thereafter on January 12,1968, the defendant John 
Montgomery, Director of the Department of Social Wel­
fare, adopted the proposed decision of the hearing officer. 
A  copy of said proposed decision of defendant John Mont­
gomery is attached hereto as Exhibit 1. Said decision or­
dered that the plaintiff’s claim be granted and that the 
defendant County restore Old Age Security, effective Sep­
tember 1, 1967, in the amount to which plaintiff-claimant 
is otherwise eligible and to cancel any demand made by



38 Appendix
defendant county on plaintiff for repayment of Old Age 
Security for the period of May through August 1967.

VII
Denies the allegations contained in paragraph X IX  and 

alleges that on January 19, 1968, defendant Director held 
a public hearing pursuant to California Government Code 
sections 11420 et seq. for the purpose of permitting indi­
viduals and others to present and discuss their views in 
regard to a proposed regulation amending sections 44-325.4, 
44-235.44, 40-181.1, 40-181.32, and 40-1255 of the Public 
Social Services Manual of the State Department of Social 
Welfare. A  copy of said proposed regulation is attached 
hereto as Exhibit 2. The explanatory statement issued by 
defendant Director (pursuant to Government Code section 
11424) with respect to the proposed amendment of said 
regulation is attached hereto as Exhibit 3.

Defendant will ask leave of court to amend this Answer 
following defendant Director’s action with respect to said 
proposed regulations.

Wherefore, defendant prays that plaintiffs take nothing 
by their complaint on file herein, that said defendant have 
judgment for his costs of suit herein incurred, and for such 
other and further relief as to the court may seem proper.

Dated: January 18, 1968
T homas C. Lynch 
Attorney General
R ichard L. Mayers 
Deputy Attorney General
E lizabeth Palmer 
Deputy Attorney General

Attorneys for State 
Department of Social Welfare, 
John C. Montgomery,
Director.



Appendix 39
Exhibit 1 to Montgomery Answer

CONFIDENTIAL

Information in this decision is protected by Section 10850, 
Welfare & Institutions Code. Violation of this section is a 
misdemeanor.

Before the Department of Social Welfare 
of the State of California

Adopted by the Department of Social Welfare 
State of California 
Director 
Jan. 15, 1968 
John C. Montgomery

State No. 38-10-56380

In the Matter of the Hearing of 

Mae W heeler

Claimant

PROPOSED DECISION 

SUMMARY

Where it has not been established that the claimant trans­
ferred personal property for the purpose of maintaining 
eligibility to receive Old Age Security (OAS), she was 
eligible to receive that aid without interruption (Public 
Social Services Manual Section 41-321).

This matter, originally scheduled for hearing on Decem­
ber 15, 1967, was postponed and then came on for hearing



40 Appendix
before Maurice Rosen, Referee for the State Department 
of Social Welfare, at 9 a.m., December 22, 1967, in Room 
400, 1407 Market Street, San Francisco, California. The 
following persons were present:
Mrs. Mae Wheeler, claimant
Mr. Peter Sitkin, Attorney, Neighborhood Legal Assistance 

Foundation, and authorized representative of the claim­
ant

Mr. Steven Antler, Law Clerk, Neighborhood Legal Assist­
ance Foundation

Mr. Bobby L. Wheeler, grandson of the claimant 
Mr. Arthur Agnos, Assistant Director, Human Relations, 

San Francisco Housing Authority, and witness for the 
claimant

Mr. J. P. Dowdall, Director, Social Services Program, San 
Francisco County Department of Social Services 

Mrs. Jane Rand, Division Supervisor, Aged Program, San 
Francisco County Department of Social Services 

Mrs. Anita Yao, Senior Supervisor, Aged Division, San 
Francisco County Department of Social Services 

Mrs. Rosella Rheaume, Social Work Supervisor, Aged Di­
vision, San Francisco County Department of Social 
Services

Miss Geraldine Palmer, Social Worker, San Francisco 
County Department of Social Services.
Based on the evidence presented at the hearing, the State­

ment of Fact, Reason for Decision, and Order are as follows:

STATEMENT OF FACT 
I

San Francisco County discontinued OAS, effective Aug­
ust 31, 1967, and has requested repayment of OAS granted



Appendix 41
during the months of May through August 1967, on the 
grounds that during April 1967 the claimant had transferred 
personal property to her grandson in order to maintain 
her eligibility to receive OAS, and. thereby rendered herself 
ineligible for public assistance as of May 1, 1967.

II
The request for a fair hearing was filed on November 21, 

1967.
The claimant maintains that:

1. She transferred the funds in question to her grand­
son, Bobby Lee Wheeler, in order to carry out the 
wishes of her dying son, R. L. Wheeler.*

2. She did not make the transfer in order to qualify 
for aid or to remain eligible for aid.

3. She was and continues to be eligible to receive OAS.

III
The issues in this case are:

1. Whether the claimant transferred personal prop­
erty in order to qualify for OAS.

2. Whether the claimant was eligible to receive. OAS 
on the point of property during months subsequent 
to April 1967.*

IV
The claimant, a 75-vear-old widow, had been receiving 

OAS continuously and in varying amounts since December 
.1959 to supplement her Social Security benefit, currently 
in the amount of $44.60 per month.

Although suffering from a heart condition and diabetes, 
she lives alone in a San Francisco Housing Authority 
apartment.

V
On February 5, 1967, the claimant’s son, R. L. Wheeler, 

an ex-serviceman, died. On or about April 3,1967, the claim-

*In December 1967, the county restored OAS pendente-lite pur­
suant to order of the Federal Court.



42 Appendix
ant, as beneficiary of her son’s veteran’s insurance, received 
from the Veterans Administration a check for $4,528.15 and, 
on or about April 6, 1967, she turned this amount over to 
her grandson, Bobby Lee Wheeler.

VI
During the ensuing five months, the claimant was, on 

several occasions, in touch with her social worker regarding 
fluctuating needs and annual redetermination of eligibility** 
but it was not until August 30, 1967 that the county learned 
from an anonymous caller of receipt by the claimant of the 
proceeds of her late son’s veteran’s insurance and the trans­
fer of these proceeds to her grandson.

VII
On or about August 30, 1967, the county placed a hold on 

the claimant’s OAS warrants and, during the ensuing two 
months, undertook an intensive investigation of the cir­
cumstances surrounding the property transfer. There were 
numerous conferences involving the claimant, as well as her 
grandson and the assistant director for human relations at 
the public housing project, for the purpose of evaluating the 
disposition of the funds received by the claimant from her 
son’s estate.* Although the claimant’s OAS warrants were

** July 25,1967.
*The County also learned that, on various dates during the 

spring and summer of 1967, the claimant had received the follow­
ing additional proceeds from her son’s estate:

1. Back Wages ..................................... $ 110.22
2. Printers Union benefits ................... 1,100.00
3. Social Security death benefits...........  255.00
4. Veterans death benefit .......................  250.00

However, it was likewise established by the county that the 
claimant had expended most of these funds for her son’s funeral 
and for legal services in connection with the estate and that there­
fore, these funds of themselves would presumably not have affected 
her ongoing eligibility for OAS.



withheld during this period, the county granted some 
amounts of county general assistance to supplement the 
claimant’s small monthly Social Security benefit,

VIII
On November 2, 1967, the county, having carefully 

weighed the evidence, including sworn statements of the 
several parties, in support of the claimant’s allegation that 
she had transferred the insurance proceeds to her grandson 
because of her promise to her son, concluded that the trans­
fer was in fact a transfer to maintain the claimant’s eligibil­
ity to OAS and therefore, took the following actions:

1. Discontinued OAS, effective August 31, 1967 and 
cancelled the subsequent withheld warrants.

2. Requested repayment of all OAS paid to the claim­
ant for the period of May 1 through August 31,1967, 
and

3. Determined that the transferred assets, less the 
$1,200 allowable reserve, would have supported the 
claimant at the rate of $200 a month for sixteen- 
and-a-half months, or until September 1968, when 
she would presumably again qualify for OAS.

IX
In sworn statements submitted prior to the hearing as 

well as at the hearing, the claimant and her grandson, 
Bobby Lee Wheeler, declared that:

1. In 1962, the now deceased R, L. WHieeler borrowed 
from his nephew Bobby Lee Wheeler, $3,000 in 
order to purchase a home at 447 Heath Street, in 
Milpitas, California.

2. In 1964, R. L. Wheeler borrowed from Bobby Lee 
Wheeler, $750 in order to purchase an automobile.

3. After 1964, R. L. Wheeler borrowed smaller sums 
of money from Bobby Lee Wheeler and, although 
he made occasional repayments to Bobby Lee

Appendix 43



Wheeler, the amount which the uncle owed the 
nephew by January 1967 totalled $4,200.*

4. Late in January 1967, R. L. Wheeler suffered a 
massive heart attack and lived for approximately 
one week thereafter.. During the final week of his 
life, R. L. Wheeler, in the presence of the claimant 
and Bobby Lee Wheeler, asked the claimant to re­
pay to Bobby Lee Wheeler from the insurance pol­
icy he had taken out in the claimant’s name many 
years before, this debt of $4,200.**

5. R. L. AVlieeler died on February 5, 1967 and, in 
accordance with his deathbed request, the claimant

. repaid to Bobby Lee Wheeler the full proceeds of 
the veteran’s benefits ($4,528.15) which she received 
in April 1967. It was understood that Bobby Lee 
Wheeler would then remit to R. L. Wheeler’s 
brother, 0. L. Wheeler, of Texas, $300f to reimburse 
him for expense incurred by him in connection with 
attendance at R. L. Wheeler’s funeral.

6. O. L. Wheeler then insisted that he had spent an 
additional $200 in connection with his trip to Cali­
fornia at the time of his brother’s funeral and, upon 
his insistence that he receive this additional money 
and to keep the family peace, Bobby Lee Wheeler 
remitted an additional $200f to O. L. AVheeler, even 
though this cut into part of the money his uncle 
R. L. Wheeler had owed to him.

44 Appendix

*AVritten records were not kept but uncle and nephew were 
allegedly fully aware of the amounts involved.

**R. L. Wheeler and his nephew Bobby Lee Wheeler had an 
especially close relationship and, although B. L. Wheeler reportedly 
owed other persons some $25,000 at the time of his death, he chose 
to have his nephew repaid from the proceeds of the insurance.

t'Money order receipts, in the amounts of $300 and $200 respec­
tively, from Bobby Lee AVheeler to O. L. Wheeler have been viewed 
by the county representative.



Appendix 45
X

The county, in finding that the transfer was a transfer to 
maintain OAS eligibility, considered that:

1. The claimant, as beneficiary of her late son’s veter­
an’s insurance policy, was entitled to receive the 
proceeds of it to meet her own needs.

2. The claimant withheld information regarding re­
ceipt of the insurance proceeds during the period 
of April through August 1967, although she had 
ample opportunity to report the facts to her worker.

3. The claimant has been unable to submit adequate 
supportive documentary evidence to substantiate 
either Bobby Lee Wheeler’s claim of R. L. Wheeler’s 
indebtedness to him or R. L. Wheeler’s acknowl­
edgement of any such debt.

X I
At the hearing, the claimant’s authorized representative 

submitted a memorandum and points of law in support of 
his argument that the claimant was bound by the terms 
of an oral trust to turn over the proceeds of her son’s 
veteran’s pension to her grandson, Bobby Lee Wheeler.

REASON FOR DECISION
I

Section 41-321 of the Public Social Services Manual pro­
vides that transfer of property made to qualify for aid 
results in ineligibility. Circumstances under which the in­
eligibility is presumed to exist as the result of property 
transfer includes a transfer of property to reduce the re­
maining holdings within the statutory maximum.

II
The same section, under the heading of Interpretation 

(guide material), includes the following:



The reason an applicant transferred property, i.e., Ms 
actual intent in doing so, is the single most essential 
element to be considered in determining the effect of 
the transfer npon his eligibility. A  transfer of prop­
erty is, in itself, disqualifying only when the transfer­
or’s reason for making the transfer was to qualify for 
a id . . .
In determining the transferor’s intent, it is necessary 
to evaluate his stated reason for the transfer and the 
consistency of such statement with the known facts. 
The consideration received for the property trans­
ferred may not have been adequate; the transfer may 
have been ill-advised and/or the transferor, in making 
the transfer, may have exercised poor judgment. How­
ever, these facts alone do not automatically establish 
that a transfer was disqualifying. The motive of the 
transfer must be carefully scrutinized, the important 
determination being the transferor’s actual reason for 
the transfer and the relationship of that reason to his 
application for aid.

III

We find, on a preponderance of the evidence, that the 
claimant did not transfer personal property for purposes 
of qualifying for OAS.

IV

Our conclusion in this respect is based upon the follow­
ing:

1. In the absence of any internal inconsistencies or 
other evidence to the contrary, we have credited the 
testimony of the claimant and Bobby Lee Wheeler 
that R. L. Wheeler owed his nephew, Bobby Lee 
Wheeler, $4,200 and that, just prior to his death, 
he had asked the claimant to repay this debt from 
the proceeds of his veteran’s insurance policy.

2. Because of this deathbed request, the claimant felt 
that she had a moral, if not legal, duty to transfer

46 Appendix



the proceeds of the insurance policy to her grand­
son.

3. Under these circumstances, it cannot be concluded 
that the transfer was a transfer to qualify for aid 
within the meaning of the cited regulation (al­
though there was failure on the part of the claimant 
to meet her reporting responsibilities).*

ORDER
The claim is granted:

1. San Francisco County shall restore OAS, effective 
September 1,1967, in the amount to which the claim­
ant is otherwise eligible.

2. San Francisco County shall cancel any demand for 
repayment of OAS for the period of May through 
August 1967.

I hereby submit the foregoing which con­
stitutes my report of the proceedings and 
proposed decision in the above-entitled 
matter, and recommend its adoption as the 
decision of the Director of the State De­
partment of Social Welfare.

/s ,/ Maurice R osen

Appendix 47

Maurice Rosen 
Referee

Dated: J anuary 12,1968

Exhibit 2 to Montgomery Answer
DETERMINATION OF ELIGIBILITY

40-173 COUNTY DEPARTMENT RESPONSIBILITY 
FOR NOTIFYING APPLICANTS AND RECIP­
IENTS (Continued)

*cf. Public Social Services Manual Section 40.105.



48 Appendix
.4 Notification When Application is Withdrawn

Use Form DP A  8, Notice to Applicant Who Withdraws 
Application. I f  the county elects to deny the applica­
tion, use Form ABCD 239.

.5 Notice to Recipient of his Responsibility
Use Form 239 C, Important Notice to All Recipients, 
as specified below:
.51 At the time of the initial warrant on new cases 

or restorations.
.52 At least semiannually on all continuing cases. 
.53 At other times when the county believes notifica­

tion would be of particular significance. (See Sec­
tion 40-171.)

.6 Confirmation of Guidance and/or Suggestions Regard­
ing Sale of Property
Regarding the sale of his real or personal property, 
written confirmation shall be given to the applicant 
or recipient. Such written confirmation shall include 
a statement regarding the effect of the proposed sale 
on eligibility. A  copy of such confirmation shall be filed 
in the case record.

40-181 CONTINUING ACTIVITIES AND INVESTI­
GATION

.1 General County Responsibility, AB, ATD, OAS, AFDC 
.11 The county paying aid is responsible for continu­

ing investigation to insure payment only to eligi­
ble recipients in the correct amount, to assist re­
cipients to meet their financial and service needs 
as fully as possible, and to make maximum use of 
their resources and capacities. The decision as to 
the frequency of investigation is based upon con­
sideration of all pertinent circumstances in each



Appendix 49
case. The reinvestigation shall not interfere with 
the prompt payment of aid unless there are rea­
sonable grounds to suspect that a change has 
occurred which may result in ineligibility or in 
overpayment which could not be adjusted within 
the adjustment period.
Aid shall not be withheld, suspended, or termin­
ated without compliance with Section 44-325.43.
In AB or A TO when disability or blindness is the 
only eligibility factor that is in question the per­
son shall he considered medically eligible such 
time as an official notification from the State De­
partment of Social Welfare declaring him inelig­
ible is received by the county.

.12 The county is responsible for continuing investi­
gation to identify promptly service needs of the 
recipient, including medical assistance, and to 
provide these services. This includes provision of 
protective services and initiation of guardianship 
or conservatorship proceedings as needed. (See 
Services chapter and Section 40-151.)

ATP PAYMENTS
325 CHANGES IN AMOUNT OF PAYMENT (Cont.)

.11 I f  the change in the aid payment (as determined 
in accord with 44-315.5, amounts to less than $2 
per month, such change is not to be made. AFDC

.12 Decrease: Where the required change is a de­
crease of $2 or less, it shall he effective not later 
than the second month following that in which 
the changed circumstances were reported, and no 
adjustment is to be made for overpayment of $2



50 Appendix
or less in the month of reporting or in the follow­
ing month. A TD

.13 Increase: When the change in circumstances will 
continue for only one or two months, and the 
amount of the increase would be $2 or less, no 
change is made in the continuing authorization.

.2 Change in Income or Need—Known in Advance, AB, 
ATD, OAS, AFDC
I f  a change in income or need is known in advance, 
any necessary change in the amount of payment is 
made effective with the month in which the changed 
circumstances will occur.

.3 Discontinuance
I f  a recipient’s circumstances change to the extent that 
he no longer meets the eligibility requirements, aid



Appendix 51
shall be discontinued effective the last day of the 
month for which the last payment was made. (See 
Section 44-315 re appropriate action when the recipient 
is no longer eligible to a cash grant but remains eligible 
to medical assistance as a medically needy person.)

.4 Withheld Payment, AB, ATD, OAS, AFDC

.41 Withheld Payment—Defined
A withheld payment is one which is held beyond 
the usual delivery date while information con­
cerning needs, income or basic eligibility is in­
vestigated, subject to Section 44-325.43.

.42 Limitations on and Requirements for Withhold­
ing of Aid Payment Subject to the following limi­
tations, aid payments shall be withheld when 
further investigation is necessary to determine 
continuing eligibility.
.421 Recipients should have the assurance of 

regular and continued aid payment without 
interruption or delay. Accordingly, an aid 
payment may be withheld beyond the usual 
delivery date only when evidence which is 
both substantial in nature and reliable in 
source is received by the county, indicating:
a. Probable ineligibility of the recipient, or
b. A  probable overpayment has occurred or 

is occuring which can be adjusted only if 
aid payment is withheld.

.43 Notification to Recipient when Aid Payment 
Withheld



Appendix
The recipient, the parent or other person respon­
sible for the child in AFDC, is to be notified im­
mediately when a warrant is going to be withheld 
beyond its nsnal delivery date for any reason 
other than death. Form ABCD 239, Notice of 
Action, or a substitute form with the same in­
formation, shall be used for this notification. 
Every notification shall also include:
.431 A  statement of what information, if any, 

is needed or action required to establish 
eligibility or to determine a correct grant.

.432 Assurance that prompt investigation is be­
ing made; that the withheld warrant will 
be delivered as soon as there is eligibility 
to receive i t ; and that the evidence or other 
information which brought about the with­
holding action will be freely discussed with 
the recipient, parent, or other person, if  he 
so desires (see Section .434, below).

.433 A  statement of whether, if aid is withheld, 
the recipient will or will not continue to be 
certified for medical assistance during the 
month aid is withheld.

.434 A  statement that, at a time and place spe­
cifically designated, the recipient, parent, 
or other person may have the opportunity 
to meet in person with the caseworker or 
with another responsible person in the 
county department in order to enable the 
recipient, parent or other person



Appendix 53
(a) to learn the nature, extent and origin 

of the information on which the with­
holding action is based;

(b) to provide any explanation or informa­
tion, including, but not limited to that 
described in the notification pursuant 
to subsection .431, above;

(c) to discuss the entire matter informally 
for purposes of clarification and, where 
possible, resolution.

Exhibit 3 to Montgomery Answer
Explanatory statement for revision of PSS 40-181.11, 

44-325.41 and 44-325.43
The proposed amendments to Sections 40-181.11, 44-325.41 
and 44-325.43 are intended to strengthen and further clarify 
the current regulations dealing with the action to be taken 
in connection with withholding, suspension and termination 
of aid.
40-181.11 Effective 3/1/68
Section 40-181.11 is proposed for amendment by addition of 

a cross-reference to Section 44-325.43 which will con­
tain the procedure to be followed.

44-325.41 Effective 3/1/68
Section 44-325.41 is proposed for the purpose of adding a 

cross-reference for the same purpose.

44-325.43 Effective 3/1/68
Section 44-325.43 is proposed for amendment to provide 

that the individual involved—whether recipient, parent, 
or caretaker, must be given an opportunity to confer in-



Appendix
formally with a responsible representative of the 
county department at a time and place stated in the 
notification to be sent, for the purpose of becoming 
fully informed of the nature, extent and basis of the 
information leading to the county action; to present 
his side of the story, including any proof he may wish 
to produce at that time; and in general afford him the 
kind of “ confrontation” declared to be essential in sev­
eral recent court decisions, and also raised in a number 
of cases currently pending in the state and federal 
courts throughout the country including California.



Appendix 55

Filed 3/20/68
United States District Court for the 

Northern District of California

[Title Omitted in Printing]
PRE-TRIAL ORDER [EXCERPT] 

# # # # # # #

6. Admitted and Undisputed Facts
A. Plaintiff Mae Wheeler is an adult citizen of the 

United States and a resident of the City and County of San 
Francisco, State of California.

B. Defendant John Montgomery is the Director of the 
California Department of Social Welfare and is charged 
with Statewide administration of the OAS program and 
with establishing rules and regulations to carry out the 
statutory provisions of said program.

C. Defendant Ronald Born is General Manager of the 
San Francisco City and County Department of Social Serv­
ices and is responsible for administration of the OAS pro­
gram in the City and County of San Francisco, State of 
California.

D. The OAS program created by §§ 12,000, et seq., of 
the California Welfare and Institutions Code provides 
financial aid to persons over 65 years of age. Persons who 
meet the statutory criteria receive financial aid as a matter 
of statutory entitlement.



56 Appendix
E. At all times relevant hereto the State of California 

and defendants, in order to receive Federal funds for the 
OAS program of the State of California have been required 
by the Social Secnrity Act, Title 42, U.S.C., §§ 301, et seq., 
to have formulated a “ State Plan” for said program, in 
conformity with the provisions of the Act and the United 
States Constitution. The Social Security Act, Title 42, 
U.S.C., § 302(a) (4), as interpreted by regulations of the 
United States Department of Health, Education and Wel­
fare, require that a “ State Plan” provide for granting an 
opportunity for a fair hearing before the State agency to 
any individual aggrieved by an action of a County Depart­
ment of Social Welfare.

F. Plaintiff Mae Wheeler, a 75 year old widow had been 
receiving OAS continuously and in varying amounts since 
December 1959 to supplement her social security benefits in 
the amount of $44.60 per month.

G. Defendant County received an anonymous telephone 
call on August 30, 1967, regarding plaintiff’s eligibility for 
OAS. Plaintiff was contacted by defendant County on 
August 30, 1967, and in that telephone conversation plain­
tiff stated that she had received and subsequently trans­
ferred during April 1967 the proceeds of a cheek in the 
sum of $4,582.15 to her grandson, Bobby Lee Wheeler, in 
accordance with her deceased son’s deathbed wish. Mrs. 
Wheeler’s September 1, 1967 warrant was withheld. De­
fendant County found her eligible for General Assistance 
funds as of December 1, 1967.

H. Plaintiff Mae Wheeler’s minimum monthly need, as 
of August 31, 1967, was determined by defendants to be 
$158.55 and was met through direct Social Security benefits 
of $44.60 and an OAS grant of $113.95. The County agreed 
to grant General Assistance on December 1, 1967, in the



Appendix 57
sum of $53.90 a month which, when added to her Social 
Security payment, would have given her a monthly income 
of $98.50. Defendant’s withdrawal and termination of her 
OAS grant caused plaintiff Mae Wheeler immediate and 
irreparable injury in that she did not have sufficient funds 
with which to subsist on a day-to-day basis without her full 
OAS payment.

I. For the reasons set forth in paragraph V III of the 
hearing officer’s proposed decision, the County on Novem­
ber 2, 1967, discontinued plaintiff’s OAS grant effective 
August 31, 1967. (A  copy of said decision, defendant Mont­
gomery’s Exhibit A, is incorporated in full herein.)

J. On November 16, 1967, plaintiff filed an appeal with 
defendant John Montgomery and requested a fair hearing 
together with a further request that her aid be restored and 
continued pending a decision after said hearing. The hear­
ing was held on December 22, 1967. On January 12, 1968, 
defendant John Montgomery, Director of the Department 
of Social Welfare, adopted the proposed decision of the 
hearing officer. The decision ordered that the plaintiff’s 
claim be granted and that she be restored to OAS effective 
September 1, 1967.

7. Facts at Issue
A. All OAS recipients are similarly affected by §§ 10950 

et seq., and §§ 12200 and 12201 of the California Welfare 
and Institutions Code, which prescribe the hearing proce­
dure in the OAS xjrogram and authorize the ex parte termi­
nation of OAS grants.

B. County Welfare personnel are authorized to grant 
financial assistance under the OAS program and other 
categorical aid programs only in accordance with the rules



58 Appendix
and regulations of the State Department of Social Welfare 
which are mandatory upon all counties.

C. The actions of the County were taken pursuant to the 
California Welfare and Institutions Code and the regula­
tions of the State Department of Social Welfare.

D. Plaintiff and all OAS recipients have no adequate 
remedy at law.

E. During the fiscal year ending June 30, 1967 (the 
latest period for which statistics are available):

(i) there were on the average 285,174 recipients of 
OAS cash grants monthly;

(ii) there were 23,555 OAS recipients whose grants 
were discontinued for reasons other than death as is 
more particularly set forth in the statistics listed infra 
as plaintiff’s Exhibit Number 4;

(iii) the average monthly grant for OAS recipients 
was $101.51;

(iv) there were 3,164 requests for fair hearings filed 
by all welfare recipients; of these 382 requests for fair 
hearings were filed by OAS recipients; and

(v) 1,766 requests were finally determined by a 
published fair hearing decision and 1,279 requests were 
resolved by other means.

P. As of January 1968, the average time from fair 
hearing request to publication of decision was approxi­
mately six months.

G. During the month of December 1967:
(i) there were 1,210 requests for fair hearings 

[Appeals] pending on the first of the month; of these 
116 were OAS requests;

(ii) 271 additional appeals were received; of these 
12 were OAS appeals;



Appendix 59
(iii) 254 appeals were disposed o f ; 179 by fair hear­

ing decision and 75 by other means; of these 32 O.AS 
appeals were disposed of; 16 by decision and 16 by 
other means; and

(iv) at the end of December 1,227 appeals were 
pending; of these 116 were OAS appeals.

H. State fair hearing referees have the authority to 
rule upon the constitutionality and validity of regulations 
of the State Department of Social Welfare and statutes 
relating to the OAS program and the other categorical aid 
programs.



60 Appendix
California State Department of Social Welfare, Public

Social Services Manual
44-325 CHANGES IN AMOUNT OF PAYMENT (effec­

tive April 1, 1968)
.43 Notification to Recipient When Aid Payment is With­

held (AB, ATD, OAS, AFDC)
The recipient, the parent or other person responsible 
for the child in AFDC, shall be notified, in writing, 
immediately upon the initial decision being made to 
withhold a warrant beyond its usual delivery date for 
any reason other than death, and in no case less than 
three (3) mail delivery days prior to the usual delivery 
date of the warrant to the recipient. The county shall 
give such notice as it has reason to believe will be 
effective including, if necessary, a home call by ap­
propriate personnel. Form ABCD 239, Notice of Ac­
tion, or a substitute form, may be used for this pur­
pose. Every notification shall include:
.431 A  statement setting forth the proposed action 

and the grounds therefor, together with what in­
formation, if any, is needed or action required to 
reestablish eligibility or to determine a correct 
grant.

.432 Assurance that prompt investigation is being 
made; that the withheld warrant will be deliv­
ered as soon as there is eligibility to receive it; 
and that the evidence or other information which 
brought about the withholding action will be 
freely discussed with the recipient, parent, or 
other person, if he so desires (see Section .434 
below).



Ax>pendix 61
.433 A  statement of whether, if aid is withheld, the 

recipient will or will not continue to be certified 
for medical assistance during the month aid is 
withheld.

.434 A  statement that the recipient, parent, or other 
person may have the opportunity to meet with 
his caseworker, an eligibility worker, or another 
responsible person in the county department, at 
a specified time, or during a given time period 
which shall not exceed three (3) working days, 
and the last day of which shall be at least one (1) 
day prior to the usual delivery date of the war­
rant, and at a place specifically designated in 
order to enable the recipient, parent, or other 
person:
(a) To learn the nature and extent of the infor­

mation on which the withholding action is 
based;

(b) To provide any explanation or information, 
including, but not limited to that described 
in the notification pursuant to Section .431 
above;

(c) To discuss the entire matter informally for 
purposes of clarification and, where possi­
ble, resolution.



62 Appendix

United States District Court 
for the Northern District of California 

No. 48303

Mae Wheeler, individually and on behalf 
of all others similarly situated,

Plaintiffs,
vs.

John Montgomery, et al.,
Defendants.

MEMORANDUM OPINION AND 
ORDER DISMISSING ACTION

This is an action for declaratory and injunctive relief. 
The facts concerning the named plaintiff—Mae Wheeler— 
are essentially as follows: The county welfare agency re­
ceived a phone call which informed the county that Mrs. 
Wheeler had received the proceeds of her deceased son’s 
insurance policy and had transferred the money to her 
grandson. The county determined that Mrs. Wheeler was 
therefore ineligible for continued welfare (Old Age Secu­
rity [O.A.S.]) assistance and terminated her aid without 
affording her a hearing on the alleged facts prior to termi­
nation. On December 20, 1967, Judge Alfonso J. Zirpoli, 
the single judge to whom the application for a temporary 
restraining order was originally addressed, signed his mem­
orandum opinion and entered various orders. He found the 
action to necessitate the convening of a three judge court 
and found a class action appropriate.

The parties have submitted extensive briefs and exhibits 
and the matter was submitted to the three judges on April 
12, 1968, following oral argument.



Appendix 63
With respect to the named plaintiff—Mae Wheeler— she 

has now been afforded a “ fair hearing” and has been found 
eligible for continued O.A.S. assistance. Furthermore, the 
claim originally pressed by plaintiff—that at least some 
hearing prior to the termination of O.A.S. was constitu­
tionally compelled—has now been conceded by defendants. 
The State of California, subsequent to Judge Zirpoli/s order 
of December 20, has adopted new regulations which do 
provide for what plaintiff terms an “ informal conference” 
with the recipient (whose aid the county is about to termi­
nate) and the county agency which is about to make the 
determination that the recipient is no longer eligible for 
aid.1

1. Reg. 44-325.43 (effective April 1, 1968), as set forth in 
CALIFORNIA STATE DEPARTMENT OF SOCIAL WEL­
FARE MANUAL, provides as follows:
44-325.43 Notification , . .

The recipient, the parent or other person responsible for the 
child in AFDC, shall be notified, in writing, immediately upon 
the initial decision being made to withhold a warrant beyond 
its usual delivery date for any reason other than death, and 
in no case less than three (3) mail delivery days prior to the 
usual delivery date of the warrant to the recipient. The 
county shall give such notice as it has reason to believe will 
be effective including, if necessary, a home call by appropriate 
personnel. Form ABCD 239, Notice of Action, or a substitute 
form, may be used for this purpose. Every notification shall 
include:
.431 A statement setting forth the proposed action and the 

grounds therefor, together with what information, if 
any, is needed or action required to reestablish eligi­
bility or to determine a correct grant.

.432 Assurance that prompt investigation is being made; 
that the withheld warrant will be delivered as soon as 
there is eligibility to receive it; and that the evidence 
or other information which brought about the with­
holding action will be freely discussed with the re­
cipient, parent, or other person, if he so desires (see 
Section .434 below).

.433 A statement of whether, if aid is withheld, the recipient 
will or will not continue to be certified for medical 
assistance during the month aid is withheld.



64 Appendix
Therefore, the only issue remaining before this court 

is that raised by the class action which contends that the 
newly adopted regulations are constitutionally inadequate 
to afford due process at the pre-termination conference. 
The class contends that the regulations are insufficient in 
five respects: (1) the conference is with a county official 
of the agency which has already determined the question 
of eligibility rather than before an “ impartial”  referee; 
(2) the three day notice requirement is too short; (3) no 
transcript is required to be made or furnished and the deci­
sion is not specifically required to be made only on the evi­
dence presented at the conference; (4) the burden of proof 
is on the recipient to establish eligibility and not on the 
county to establish ineligibility, and (5) confrontation and 
cross-examination are not required.

The constitutionality of the “ informal conference”  must 
be determined in light of the fact that even if aid is termi­
nated, the State of California must provide the recipient 
with the kind of hearing plaintiff seeks.2 At present such

.434 A statement that the recipient, parent, or other per­
son may have the opportunity to meet with his case­
worker, an eligibility worker, or another responsible 
person in the county department, at a specified time, 
or during a given time period which shall not exceed 
three (3) working days, and the last day of which shall 
be at least one (1) day prior to the usual delivery date 
of the warrant, and at a place specifically designated in 
order to enable the recipient, parent, or other person:
(a) To learn the nature and extent of the information 

on which the withholding action is based;
(b) To provide any explanation or information, in­

cluding, but not limited to that described in the 
notification pursuant to Section .431 above;

(c) To discuss the entire matter informally for pur­
poses of clarification and, where possible, resolu­
tion.

2. CAL. WELF. & INST. CODE SS 10950-10965.



Appendix 65
“ fair hearing”  is required to be given within 45 days3 and 
a decision rendered within the next 75 days,4 5 As of July 
1, 1968, the hearing and decision will be required to be made 
within 60 days.®

The court finds that the present California regulations 
(see note 1) do comport with the due process clause of the 
fourteenth amendment to the United States Constitution. 
The State of California having given Mae Wheeler, the 
named plaintiff, a fair hearing in which she has been found 
eligible for O.A.S., and having adopted regulations which 
assure all within the class due process before termination, 
the purpose of this action has been achieved and this pro­
ceeding may, with propriety, now be dismissed.

It is SO ORDERED.

Dated: April 17, 1968
0. D. Hamlin

United States Circuit Judge
A lbert C. W ollenberg

United States District Judge
A leonso J. Zirpoli

United States District Judge
Filed April 19, 1968

3. CAL. WELF. & INST. CODE § 10952.
4. CAL. WELF. & INST. CODE § 10958.
5. HANDBOOK OF PUBLIC ASSISTANCE ADMINISTRA­

TION § 6200 (j ), as set forth in Handbook Transmittal No. 140 
(attached to Defendants’ Trial Brief as Exh. B), provides as 
follows:

6200. Requirements for State Plans

(j) Prompt, definitive, and final administrative action will 
be taken within 60 days from the date of the request for 
a fair hearing. The claimant will be notified of the deci­
sion, in writing, in the name of the State agency and, to 
the extent it is available to him, of his right to judicial 
review.