PR 01410.036 North Carolina

A. PR 08-100 Adopted Childrens' Eligibility for Benefits on Record of Natural Mother - North Carolina Claimants: Austin B~ and Ashley B~ Number Holder: Brenda F~

DATE: April 17, 2008

1. SYLLABUS

Because adopted children cannot inherit intestate personal property from a natural parent under North Carolina law, they are not NH's children under section 216(h)(2)(A) of the Act. Moreover, because the evidence does not indicate NH was contributing to Claimants' support at the time she died, they are not NH's children under section 216(h)(3)(C) of the Act.

2. OPINION

QUESTION

You have asked whether adopted children can receive child's insurance benefits on the earnings record of their natural mother

We conclude the adopted children cannot receive child's insurance benefits on the earnings record of their natural mother because the relationship between the children and their natural mother was severed upon their adoption and the evidence does not indicate their natural mother was living with or not contributing to their support at the time of her death.

BACKGROUND

Austin and Ashley B~ (Claimants) filed for child's insurance benefits as the surviving children of Brenda F~, the number holder (NH). NH is the natural mother of Claimants, but Claimants have lived with NH's sister and her husband since 2003 and were adopted by NH's sister and her husband on June 6, 2006. NH died October 6, 2007, while domiciled in North Carolina. Before her death, a court ordered her on January 27, 2003, to pay $412.77 a month for the support of the children. NH apparently did not make the monthly payments but gave her sister $1,000 in September 2007 and $500 in October 2007 to help support Claimants. She apparently did not make other payments, even when she was working.

DISCUSSION

To qualify for child's insurance benefits on the earnings record of an insured individual who has died, a claimant must be the insured individual's "child." See Social Security Act (Act) § 202(d), 42 U.S.C. § 402(d); 20 C.F.R. § 404.350(a)(1) (2007). "Child" may include the natural child, adopted child, stepchild, or in some cases, grandchild, of an insured individual. See Act § 216(e), 42 U.S.C. § 416(e); 20 C.F.R. § 404.354 (2007). A claimant may be eligible for benefits as the natural child of a deceased insured individual if he or she could inherit a child's share of the insured individual's personal property under the laws of the state in which the insured individual was domiciled at the time of his or her death. See Act § 216(h)(2)(A); 20 C.F.R. § 404.355(a)(1), (b)(1), (4) (2007). Because NH died in North Carolina, we apply North Carolina law to determine if Claimants are the children of NH for the purposes of intestate succession under section 216(h)(2)(A) of the Act.

Program and Operations Manual System (POMS) GN 00306.165A states that a child of the number holder who was adopted by another person during the number holder's lifetime is the number holder's child for benefit purposes only if the adoption did not cut off the child's inheritance rights in the number holder's estate under applicable State law. North Carolina law severs the relationship between an adopted child and his or her natural parent upon adoption by another person. N.C. GEN. STAT. § 48-1-106 (2007) provides for the legal effect of a decree of adoption as follows:

(a) A decree of adoption effects a complete substitution of families for all legal purposes after the entry of the decree.

(c) A decree of adoption severs the relationship of parent and child between the individual adopted and that individual's biological . . . parents. After the entry of a decree of adoption, the former parents are relieved of all legal duties and obligations due from them to the adoptee.

The North Carolina Supreme Court has concluded that the General Assembly "evidenced its intent that by adoption the child adopted becomes legally a child of its new parents, and the adoption makes him legally a stranger to the bloodline of his natural parents." Crumpton v. Mitchell, 281 S.E.2d 1, 4 (N.C. 1981). Further, the court stated an adoption is intended as "a complete substitution of families" and severs the adopted child's legal ties with his natural parents including rights of intestate succession. Id. at 5. Thus, it appears that, under North Carolina law, Claimants are not NH's children for the purposes of intestate succession, and are not eligible for child's insurance benefits on NH's earnings record under section 216(h)(2)(A) of the Act.

However, a child claimant who does not satisfy the requirements of section 216(h)(2)(A) still may be deemed the child of a deceased insured individual if the child satisfies the criteria in section 216(h)(3)(C) of the Act. A child who is the son or daughter of a deceased insured individual will be deemed to be the child of the insured individual if the insured individual is shown by evidence satisfactory to the Commissioner to have been the mother or father of the applicant, and such insured individual was living with or contributing to the support of the applicant at the time such insured individual died. Act § 216(h)(3)(C)(ii); see 20 C.F.R. § 404.361(b) (2007); POMS GN 00306.008. Contributions for support should be regular and substantial contributions in cash or in kind and in an amount that is a reasonable factor in the reasonable cost of the child's support. 20 C.F.R. Sec. 404.366 (2007); POMS RS 01301.005A. Contributions also should be consistent. Id. NH was not living with Claimants when she died. Regarding contributions for support, the evidence provided indicates NH provided only two payments to help support Claimants - one of $1,000 in September 2007 and one of $500 in October 2007. The contributions do not appear to be regular, substantial, or consistent. Accordingly, the evidence submitted does not appear to establish that NH was contributing to the support of Claimants. Thus, the evidence does not show that Claimants could be deemed the children of NH under section 216(h)(3)(C)(ii) of the Act.

CONCLUSION

Because Claimants cannot inherit NH's intestate personal property under North Carolina law, they are not NH's children under section 216(h)(2)(A) of the Act. Moreover, because the evidence does not indicate NH was contributing to Claimants' support at the time she died, they are not NH's children under section 216(h)(2)(A) of the Act. Therefore, Claimants are not Claimants are not the children of NH for purposes of child's insurance benefits on NH's earnings record.

Thus, with respect to your inquiry as to the correct procedure pursuant to GN 00306.170 (North Carolina), it appears that a child adopted after 3/10/49 may NOT inherit from a natural parent except where the adoption proceedings began before that date and were completed after that date in accordance with such law in effect between 3/15/41 and 3/11/49 (in such cases the POMS rule covering that period would apply). As previously stated, by 1955 statutory amendment, adopted children are specifically prohibited from inheritance rights to real and personal property of a natural parent.

B. PR 00-207 Children Adopted by Someone Other Than the Number Holder, AN ~, NH Daryl E. C~

DATE: September 23, 1999

1. SYLLABUS

The NH's natural children, who were adopted by someone else before his death, do not have the status of children relative to taking intestate personal property of the NH, and are not eligible for child's insurance benefits under section 216(h)(2)(A) of the Act. If the NH was living with them or contributing to their support when he died, they would be entitled to benefits under section 216(h)(3) of the Act.

For purposes of POMS GN 00306.170, it is not necessary to submit to the RCC all North Carolina cases in which the NH died after 6/30/55. By 1955 statutory amendment, adopted children are specifically prohibited from inheriting from the natural parent. (POMS GN 00306.170 is being revised to reflect this change.)

2. OPINION

You have asked whether the natural children of number holder (NH) Daryl E. C~ can be entitled to benefits as the NH's survivors when they had been adopted by someone else during the NH's lifetime. The facts presented are that the NH's sister, Helen F. K~, adopted the NH's natural children, Daryl W. C~ and Rena L. C~, on June 12, 1989. The NH died in North Carolina on March 15, 1999. On April 28, 1999, Ms. K~ filed for child's insurance benefits on behalf of both children. It is not clear from the materials presented whether the NH was actually living with or contributing to the children's support at the time of his death. For the reasons set forth below, if the NH was not living with or contributing to the children's support when he died, the children cannot be entitled to benefits on his record. If the NH was living with or contributing to the children's support when he died, the provisions of 42 U.S.C. §§ 416(h)(2)(A) and 416(h)(3)(C)(ii) should be considered.

In addition, you have asked whether all North Carolina cases in which the natural parent died after 6/30/55 should be submitted to OGC, or only those in which the adoption proceedings began after 3/15/41 and before 3/11/49. This inquiry arose out of POMS GN 00306.170 (State Laws on the Right of Adopted Child to Inherit from Natural Parent - North Carolina).

If the NH was not living with or contributing to the children's support when he died, North Carolina intestacy law does not affect the outcome of the instant claims because the children were adopted before they applied for benefits and before the NH died. Under 20 C.F.R. § 404.361(b)(1), amended effective April 26, 1999, "Except as indicated in paragraph (b)(2) of this section, if you are legally adopted by someone other than the insured (your natural parent) during the insured's lifetime, you are considered dependent upon the insured only if the insured was either living with you or contributing to your support ...".

If the NH was living with or contributing to the children's support when he died, 20 C.F.R. § 404.361(b)(1) would not preclude their entitlement, and, as previously stated, the provisions of 42 U.S.C. §§ 416(h)(2)(A) and 416(h)(3)(C)(ii) should be considered. Your inquiry focuses on the application of § 416(h)(2)(A). This section provides that applicants who according to State law would have the same status relative to taking intestate personal property as a child shall be deemed such.

Section 48-1-106 of the General Statutes of North Carolina (N.C. Gen. Stat.) provides for the legal effect of a decree of adoption as follows:

(a) A decree of adoption effects a complete substitution of families for all legal purposes after the entry of the decree...

(c) A decree of adoption severs the relationship of parent and child between the individual adopted and that individual's biological ... parents. After the entry of a decree of adoption, the former parents are relieved of all legal duties and obligations due from them to the adoptee ....

The North Carolina Supreme Court has concluded that the General Assembly "evidenced its intent that by adoption the child adopted becomes legally a child of its new parents, and the adoption makes him legally a stranger to the bloodline of his natural parents." Crumpton v. Mitchell, 281 S.E.2d 1, 4 (N.C. 1981). Further, the court states that an adoption is intended as "a complete substitution of families" and severs the adopted child's legal ties with his natural parents including rights of intestate succession. Id. at 5. Thus, it appears that, under North Carolina law, Daryl W. C~ and Rena L. C~ do not have the status of children relative to taking intestate personal property of the NH, and are not eligible for children's insurance benefits based on his account under 42 U.S.C. § 416(h)(2)(A).

However, an applicant who is the son or daughter of an insured individual but who is not, and is not deemed to be, the child of that individual under § 416(h)(2) shall nevertheless be deemed to be the child of the insured if the insured individual is deceased and is shown by evidence satisfactory to the Commissioner to have been the mother or father of the applicant, and such insured individual was living with or contributing to the support of the applicant at the time such insured individual died. 42 U.S.C. § 416(h)(3)(C)(ii). Consequently, if as you state in your inquiry, Daryl and Rena are the NH's natural children and he was living with them or contributing to their support when he died, the children would be entitled to child's benefits. Otherwise, they are precluded from benefits under 20 C.F.R. § 404.361(b)(1).

You have also asked which cases should be submitted to the RCC pursuant to GN 00306.170 (North Carolina). By way of background, the General Assembly of North Carolina enacted its first adoption statute in 1873. The 1873 statute was first rewritten in 1941. The 1941 statute (§ 48-6) continued a distinction between adoptions for the minority of the child and adoptions for the life of the child. Succession by children adopted for life from or through their natural parents took place only where, but for such succession, the State of North Carolina would succeed to the intestate's property (escheat). The provisions of N.C. Gen. Stat. § 48-6 were made applicable only to adoptions made after March 15, 1941. In 1949, a 1947 rewrite of the statute took effect, and the legislature omitted the provision allowing inheritance by, from or through a natural parent to prevent escheats. By amendments enacted in 1955, adopted children were specifically prohibited from inheritance or succession rights to real and personal property by, through, or from a natural parent. N.C. Gen. Stat. §§ 28-149(10) and (11) and 29-1(14) and (15). In 1963, the rights of the adopted child were further spelled out.

As stated in Crumpton v. Crumpton, 221 S.E.2d 390, 393 (N.C. App. 1976):

It seems abundantly clear that the General Assembly, on its own motion and also in response to judicial decisions, has, with every amendment and every rewrite of the adoption statute, evidenced its intent that by adoption the child adopted becomes legally a child of its new parents, and the adoption makes him legally a stranger to the bloodline of

his natural parents. See Rhodes v. Henderson, 188 S.E.2d 565 (N.C. App. 1972).

Thus, with respect to your inquiry as to the correct procedure pursuant to GN 00306.170 (North Carolina), it appears that a child adopted after 3/10/49 may NOT inherit from a natural parent except where the adoption proceedings began before that date and were completed after that date in accordance with such law in effect between 3/15/41 and 3/11/49 (in such cases the POMS rule covering that period would apply). As previously stated, by 1955 statutory amendment, adopted children are specifically prohibited from inheritance rights to real and personal property of a natural parent.


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PR 01410.036 - North Carolina - 05/05/2008
Batch run: 01/27/2009
Rev:05/05/2008