Decision
In the appeal proceedings
xxx
plaintiff and appellant,
Legal representative:
Attorney Sven Adam,
Lange Geismarstraße 55, 37073 Göttingen,
against
xxx
defendant,
The 7th Senate of the Lower Saxony-Bremen State Social Court decided on December 7, 2011 in Celle through Judge xxx, Judge xxx, and Judge xxx:
- Upon appeal by the plaintiff, the decision of the Hildesheim Social Court of September 11, 2011 is overturned.
- The plaintiff is granted legal aid for the purpose of conducting the legal proceedings, with the appointment of attorney Adam, Göttingen. No installments are payable.
- Extrajudicial costs for the appeal proceedings are not reimbursable.
Reasons:
I.
By decision dated May 5, 2010, the defendant granted the plaintiff benefits to secure her livelihood under Book Two of the German Social Code (SGB II) for the period from June 1 to November 30, 2010, in the amount of €677.53 per month. The plaintiff filed an objection to this decision by letter from her attorney dated May 11, 2010, and by power of attorney dated July 16, 2010. The power of attorney is entitled: "Power of Attorney in Social Law Proceedings" and authorizes the representation of the plaintiff by the authorized attorney in her social law case against the social services agency in the district of xxx regarding benefits under SGB II. By a remedial decision dated August 9, 2010, the defendant granted the objection in full, recalculated the plaintiff's benefits for the benefit period in a separate decision, and paid the requested difference. The remedial decision of August 9, 2010 included information on legal remedies.
By letter dated August 16, 2010, the plaintiff, submitting a utility bill from her landlord for the year 2009 dated August 11, 2010, requested reimbursement of the outstanding balance of €173.57. By a decision addressed to the plaintiff on September 13, 2010, the defendant agreed to cover the outstanding balance of €123.78. The plaintiff, through her attorney, filed an objection to this decision on September 16, 2010, arguing that, in the absence of technical metering devices, the deduction for hot water costs should only be based on the flat rates recognized by the Federal Social Court (BSG), and not on a formula from the Heating Costs Ordinance.
The defendant acknowledged receipt of the objection and requested that the plaintiff submit a power of attorney. Subsequently, the plaintiff's attorney submitted a certified copy of the power of attorney dated July 16, 2010, which had been filed in the initial objection proceedings. In a further letter dated October 13, 2010, the defendant requested the plaintiff, setting a deadline, to submit a current power of attorney for the ongoing objection proceedings. By decision dated November 2, 2010, the defendant rejected the objection as inadmissible. He reasoned that, according to a decision of the Federal Social Court (BSG) of November 2, 2005 – B 6 KA 43/05 B – a power of attorney granted is only valid for the current administrative proceedings. The plaintiff's attorney, however, had not submitted a new power of attorney, so proper authorization had not been proven. He (presumably referring to the plaintiff) was not aggrieved by the decision of September 13, 2010. According to the plaintiff, the defendant later reimbursed the outstanding claim from the 2009 annual statement of ancillary costs by means of a decision issued in accordance with Section 44 of the Tenth Book of the Social Code (SGB X).
The plaintiff filed a lawsuit with the Hildesheim Social Court (SG) on November 25, 2010, against the defendant's decision of September 13, 2010, as amended by the decision on the objection of November 2, 2010, and applied for legal aid. At the defendant's request, the SG obtained the case file from another chamber concerning a different plaintiff and different legal representatives against the defendant (case number: S 37 AS 1181/08), in which the lawsuit had been dismissed in the preliminary proceedings due to lack of proof of authorization, and the SG apparently intended to adopt the reasoning of that dismissal for these proceedings as well. As far as can be ascertained, the plaintiff and her legal representative were not informed of this. The Social Court then rejected the plaintiff's application for legal aid by decision of September 1, 2011, because there was no effective representation pursuant to Section 13 of the German Social Code, Book X, so that the defendant was right to dismiss the objection as inadmissible.
The plaintiff filed an appeal against this decision on September 14, 2011. The plaintiff argues that she has been represented by a lawyer for years in matters concerning benefits under the German Social Code, Book II (SGB II), vis-à-vis the defendant, including for the benefit period from June 1 to November 30, 2010, which concerns the disputed additional payment from the 2009 utility bill. The authorization is proven by corresponding powers of attorney; this authorization has not been revoked. The requirement for a further power of attorney pursuant to Section 13 Paragraph 1 Sentence 3 of the German Social Code, Book X (SGB X) is at the discretion of the authority. However, there was no reason whatsoever for the defendant to doubt the authorization. In any case, the defendant could have dispelled these doubts by contacting the plaintiff personally.
The defendant counters that, according to the jurisprudence of the Federal Social Court (judgment of August 15, 1991 – 12 RK 39/90 –), the power of attorney is valid only for the specific administrative proceedings until the contested decision becomes legally binding. The authority alone, and not the lawyer, determines whether and how authorization must be proven. The plaintiff was requested to submit a current power of attorney for the new objection proceedings, which she failed to do. The respondent requires a separate power of attorney for each objection proceeding in the interest of legal clarity. However, the "lawyer" is clearly trying to establish a "law of the people" here. Had the "lawyer" proven his authorization at the time, the lawsuit would not have arisen at all, because the disputed legal question regarding the calculation of the hot water deduction was already settled or pending in 2010. The entire conduct of the "lawyer" should therefore be classified as "harassing the courts.".
II.
The plaintiff's admissible appeal is well-founded and leads to the reversal of the social court's decision. She is to be granted legal aid for the purpose of conducting the legal proceedings because there are sufficient prospects of success within the meaning of Section 73a of the Social Courts Act (SGG) in conjunction with Section 114 of the Code of Civil Procedure (ZPO). The plaintiff is unable to cover the costs of the litigation from her own resources. The appointment of a lawyer is based on Section 121 Paragraph 2 of the Code of Civil Procedure (ZPO).
No procedural obstacles preclude a decision on the merits. The defendant was not entitled to dismiss the plaintiff's objection as inadmissible. Proper authorization exists, which the plaintiff demonstrated to the defendant in accordance with Section 13 Paragraph 1 Sentence 3 of the German Social Code, Book X (SGB X).
The general legal principle invoked by the defendant, namely that a power of attorney is always limited to an individual and current administrative procedure, cannot be established in such general terms. In particular, such a legal principle cannot be derived from Section 13 Paragraph 1 of the German Social Code, Book X (SGB X). The power of representation is also established in social administrative proceedings by a legal transaction to which the provisions of civil law regarding powers of attorney apply accordingly (cf. Sections 164 et seq. of the German Civil Code – BGB –), insofar as Section 13 of the SGB X does not contain specific regulations (Vogelgesang in: Hauck/Noftz, SGB X, 2007 edition, Section 13, marginal note 4). Consequently, every citizen is free to appoint a representative to the social welfare authority by means of an express power of attorney. This representative then assumes general representation until the power of attorney is revoked, with the consequence that the representative may make legally binding declarations on behalf of the represented party at any time, and the authority is obligated to conduct all correspondence—except for declarations of a highly personal nature—exclusively through the representative. Section 13 Paragraph 1 of the German Social Code, Book X (SGB X) does not preclude this. According to Section 13 Paragraph 1 Sentence 1 SGB X, a party may be represented by a representative. From this, it can at most be inferred that—unlike in other areas of law—only one representative, and not several simultaneously, may be appointed in social welfare administrative proceedings. According to Section 13 Paragraph 1 Sentence 2 SGB X, the power of attorney authorizes all procedural acts relating to the administrative proceedings, unless its content provides otherwise. Section 13 Paragraph 1 Sentence 2, second half-sentence, of the German Social Code, Book X (SGB X) directly refutes the defendant's assertion that the scope of the power of attorney is normatively limited to administrative proceedings. Rather, the wording of Section 13 Paragraph 1 Sentence 2, second half-sentence, of the SGB X stipulates that, for reasons of legal certainty, restrictions on the power of representation only apply if they arise from the content of the power of attorney itself, whereby the authority must generally assume that the power of attorney is not restricted (Fichte et al., Handbook of Social Administrative Procedure Law, Section 2, marginal note 263). Finally, according to Section 13 Paragraph 1 Sentence 3 of the SGB X, the authorized representative must provide written proof of their power of attorney upon request. It is within the authority's discretionary power of attorney whether, in a specific case, it requires the submission of a written power of attorney because there are reasonable doubts about the authorization. Written proof is generally not required if a lawyer acts as authorized representative, because proper authorization by the party involved can be presumed in such cases (Vogelgesang, loc. cit., para. 18). The power of attorney granted remains effective vis-à-vis the authority until it receives a revocation of the power of attorney (§ 13 para. 1 sentence 4 SGB X).
Contrary to the opinion of the defendant and the Social Court, a general restriction of the power of attorney cannot be based on the case law of the Federal Social Court (BSG). The BSG's judgment of August 15, 1991 – 12 RK 39/90 – in SozR 3-1500 § 73 No. 2 is not applicable at all. That case concerned the question of whether a power of attorney granted for administrative proceedings and contained in the administrative file also authorized the conduct of legal proceedings before the social court, because the then-current version of Section 73 Paragraph 2 Sentence 1 of the Social Courts Act (SGG), valid until June 30, 2008, required the power of attorney to be granted "for the file," thus necessitating a decision on whether the term "file" referred to the administrative files or the court files. The BSG makes no mention whatsoever of whether this power of attorney authorizes further declarations or actions in (different) administrative proceedings before the same authority. The second decision of the Federal Social Court (BSG) cited by the defendant (decision of November 2, 2005 – B 6 KA 340/05 B –) is even less relevant, as the case decided there concerned the scope of a power of attorney that could no longer be located. However, if it had contained the same information as a previous power of attorney, it would have been expressly limited to the cost-effectiveness review proceedings of a physician against the Association of Statutory Health Insurance Physicians. As the detailed explanations in the decision reveal – a fact overlooked by the defendant – the BSG's reasoning is based on specific features of statutory health insurance physician law, which recognizes different responsibilities in cost-effectiveness review proceedings between the Association of Statutory Health Insurance Physicians, the review committee, and the appeals committee (therefore misleading: von Wulffen, SGB X Commentary, 7th edition, § 13, marginal note 7).
The scope of a power of attorney, like other private declarations of intent, is determined by the actual content of the declaration. It therefore remains to be established what the declarant verbally expresses in each individual case and what they truly intended with their declaration. While it is certainly beneficial for all parties involved if a power of attorney is tied to the course of a specific procedure by precisely defining its subject matter, this is not legally required. If the power of attorney is solely characterized by the authority to represent the other party in a particular administrative procedure, it remains valid only until the administrative procedure is concluded by a legally binding decision. Whether such a limitation to a single administrative procedure exists must be determined, if necessary, through interpretation. However, the content of a power of attorney is determined neither by the defendant nor by the authorized representative, but exclusively by the plaintiff herself through her declaration. Applying these principles, the Senate concludes that the present action cannot be dismissed on the grounds that the plaintiff failed to prove a valid power of attorney in the objection proceedings.
The power of attorney at issue here, dated July 16, 2010 (p. 154 of the administrative file), was granted by the plaintiff, according to its heading, within the context of social law proceedings, specifically for the representation of the plaintiff by the appointed attorney in her social law case against the social services agency in the district of xxx regarding benefits under the German Social Code, Book II (SGB II). Contrary to the opinion of her legal representative, the plaintiff did not authorize him to submit documents to the defendant on her behalf for subsequent periods, nor did she obligate the defendant to serve all amendments and benefit notices on him for subsequent periods. The plaintiff did not express such a comprehensive power of attorney with the necessary clarity in her declaration, which only covers one social law case against the social services agency in the district of xxx. It is also not to be assumed that she intends or is able to assume attorney's fees for this comprehensive legal representation, which would otherwise be non-reimbursable expenses in the administrative proceedings. However, the content of the power of attorney does not indicate that the power of attorney dated July 16, 2010, only authorizes the conduct of a specific objection proceeding. The starting point for the power of attorney of July 16, 2010, is the plaintiff's objection to the defendant's decision of May 5, 2010, which granted unemployment benefit (ALG II) for the period from June 1 to November 30, 2010. There is no indication that the plaintiff intended to use this power of attorney to retrospectively approve the objection filed on May 11, 2010, to exclude other declarations by her authorized representative for the same benefit period, or to limit the representation to specific legal objections (e.g., rounding up the benefit rates). Rather, in the best interests of the plaintiff, it must be assumed that the lawyer was authorized to make all declarations and take all actions suitable to secure the maximum possible SGB II benefits for her during the benefit period from June to November 2010, if necessary after involving the European Court of Human Rights, as the later added clause in the power of attorney form shows.
With this declaration of intent, the power of attorney also covers the plaintiff's request in the letter of August 16, 2010, for the assumption of the additional payment amount from the utility bill for the year 2009. If, after the regular assumption of ongoing expenses for accommodation and heating pursuant to Section 22 of the German Social Code, Book II (SGB II), additional payments are demanded after the annual statement has been issued, the payments owed, upon their due date, constitute the need relevant under basic income support law (Federal Social Court [BSG] judgment of July 2, 2009 – B 14 AS 36/08 R –, SozR 4-4200 § 22 No. 23). Since the additional payment for ancillary costs became due in August 2010, the provision in the notice of September 13, 2010, concerns the costs for accommodation and heating for the benefit period June–November 2010, as regulated in the notice of May 5, 2010, as amended by the (here unknown) notice issued in August 2010. From a procedural standpoint, the defendant has only made a benefit adjustment pursuant to Section 48 Paragraph 1 Sentence 1 of the German Social Code, Book X (SGB X), for the same benefit period. However, it is within the sole decision-making and declaration authority of the plaintiff to orally instruct her authorized representative to enforce her claim in the letter of August 16, 2010, and to consider this instruction as covered by the power of attorney granted on July 16, 2010, for the benefit period June–November 2010. There are no legal objections to this, since the defendant, when questioned by the Senate, was unable to cite any credible circumstances for representation without authorization.
The dismissal of the action contemplated by the Social Court is also precluded from another legal perspective. By a decision dated August 9, 2010 (p. 134 of the administrative file), which included instructions on how to appeal, the defendant informed the plaintiff that her objection to the decision of May 5, 2010, was fully granted and that further details could be found in a separate decision not on file. This separate decision recalculated and determined the SGB II benefits for the period from June to November 2010, presumably also including instructions on how to appeal. With her request in the letter of August 16, 2010, regarding the additional payment from the utility bill for 2009, the plaintiff thus expressed her disagreement with the new decision concerning the benefit period from June to November 2010 within the newly opened appeal period. This can be interpreted as either a new objection or a continuation of the original objection of May 11, 2010. It requires no further discussion that, under these circumstances, the power of attorney granted also covered the plaintiff's request regarding the utility bill and that the defendant should have served the further (partial remedy) decision of September 13, 2010, on the authorized representative pursuant to Section 13 Paragraph 3 Sentence 1 of the German Social Code, Book X (SGB X), and subsequently – insofar as the objection was not resolved – issued a formal decision on the objection. This course of action was primarily in the defendant's economic interest, as it forced the plaintiff into a second objection proceeding and now requires the defendant to reimburse legal fees twice, pursuant to Section 63 of the German Social Code, Book X (SGB X).
The plaintiff's claim is also promising from a substantive legal perspective because, based on the legal arguments correctly presented by the plaintiff, the additional payment due from the utility bill for 2009 must be paid in full. The defendant has since acknowledged this in the form of an admission of liability, erroneously disguised as a decision pursuant to Section 44 of the German Social Code, Book X (SGB X), which the plaintiff accepted pursuant to Section 101 Paragraph 2 of the German Social Court Act (SGG). However, it is incomprehensible why the defendant withheld this additional payment from the plaintiff for over a year, especially since, according to the defendant, no legal action would have been necessary if the plaintiff had properly proven her authorization.
The plaintiff's legal action is not frivolous, which, according to Section 114 Sentence 1 of the German Code of Civil Procedure (ZPO), would otherwise lead to the denial of legal aid. Contrary to the defendant's assertion, the plaintiff's procedural conduct cannot be categorized as "harassing the courts." Rather, the plaintiff had no other option but to pursue legal action after her SGB II benefits were apparently denied solely because the caseworker in question harbored personal reservations about her legal representative, as evidenced by the defendant's choice of words in the pleadings of the appeal proceedings. It would now behoove the defendant to submit the necessary declarations regarding the procedural and cost consequences for the proceedings still pending in the first instance concerning the benefit period in dispute here.
The costs of this appeal procedure are not reimbursable (§ 127 para. 4 of the Code of Civil Procedure).
This decision is not subject to appeal (§ 177 SGG).
