PS 01215.047 Tennessee

A. PS 90-001 Recovery from Estate Administered by Legal Representative - Overpaid SSI Recipient - Thelma O~

DATE: May 08, 1990

1. SYLLABUS

The United States government has a cause of action in federal courts against the personal representative of an estate where he, with notice of the government's claim, distributes the assets of the estate to inferior creditors. United States v. Vibradamp Corporation, 257 F.Supp. 931 (D.C.Cal. 1966). Nevertheless, where the government's claim is de minimus ($224) and the estate has been closed, further action to recover the overpayment would not be warranted.

2. OPINION

(O~, Thelma - SSN ~ - CCIV - [Walters] - to ARC, Progs., Atl., 05/08/90)

You have requested our assistance in obtaining a refund of an overpayment of Supplemental Security Income (SSI) benefits. The facts, as set forth in the file, are that Thelma O~ was overpaid SSI benefits in the amount of $421.40 for the period from April 1984 through July 1986. Before Ms. O~ became ineligible for SSI benefits in June 1986, $197.40 of the overpayment was collected from her monthly payment checks. A balance of $224.00 is outstanding.

Ms. O~ died in July 1988. Attorney Robert F. S~, administrator of her estate, was notified of the overpayment balance on August 30, 1989, with a copy sent to the Macon County (North Carolina) Clerk of Court. On September 22, 1989, Mr. S~ notified the Administration that as the government's claim was not presented within six (6) months after notice to creditors was published in a paper of general circulation, it was rejected.

Telephone contact with Mr. S~ on April 18, 1990, revealed that the estate has been closed and that, following the payment of funeral bills, cost of administration, etc., the remaining $1,000 in assets was not sufficient to satisfy formal claims of creditors. The creditors were paid pro rata at approximately ten cents on the dollar.

Telephone contact with the Macon County Clerk of Court's office on April 18, 1990, verified that the estate was closed on January 17, 1990, and that, under North Carolina law, the last date to exhibit claims was February 12, 1989. The assets of the estate when opened were $10,000 in real property and $1,376 in personal property. When the estate was closed, $6,666.67 had been received in proceeds from the sale of the real property and the personal property continued to be valued at $1,376; total assets were $8,042.67. Disbursements of $7,247 included funeral and administration costs, medical and hospital expenses, attorney's fees, etc. The remaining assets were apparently distributed to creditors, as indicated by Mr. S~, on a pro rata basis.

The United States government has a cause of action in federal court against the personal representative of an estate where he, with notice of the government's claim, distributes the assets of the estate to inferior creditors. United States v. Vibradamp Corporation, 257 F.Supp. 931 (D.C.Cal. 1966). Nevertheless, it is the opinion of this office, that as the government's claim is de minimus, an outstanding overpayment balance of $224, and as the estate has been closed and the limited assets distributed, further action to recover the overpayment would not be cost- effective and, thus, would not be warranted.


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PS 01215.047 - Tennessee - 04/16/2008
Batch run: 01/27/2009
Rev:04/16/2008