F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
AUG 18 1998
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
WILMER DANIELS,
Plaintiff-Appellant,
v. No. 98-5004
KENNETH S. APFEL, Commissioner,
Social Security Administration,
Defendant-Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OKLAHOMA
(D.C. No. 96-CV-784-M)
Submitted on the briefs:
Paul F. McTighe, Jr., and Gayle L. Troutman, Tulsa, Oklahoma, for Plaintiff-
Appellant.
Stephen C. Lewis, United States Attorney, Tina M. Waddell, Chief Counsel,
Region VI, Christopher Carillo, Lead Attorney, SSA-Office of the General
Counsel, Dallas, Texas, for Defendant-Appellee.
Before TACHA and McKAY, Circuit Judges, and BROWN, * Senior District
Judge.
*
Honorable Wesley E. Brown, Senior District Judge, United States District Court
for the District of Kansas, sitting by designation.
BROWN , Senior District Judge.
The primary question on this appeal is whether the Commissioner
adequately considered the fact that claimant Wilmer Daniels was only a little
more than two months short of being in an age category in which he would be
presumptively disabled, when the Commissioner found him not disabled based on
the Medical-Vocational Guidelines, 20 C.F.R. Pt. 404, Subpt. P, App. 2 (the
“grids”). Because we conclude that, contrary to agency regulations and rulings,
the Commissioner failed to consider the fact that claimant fell within a
“borderline” age situation and therefore improperly applied the grids
“mechanically,” we must remand the case for further consideration. 1
I.
Mr. Daniels filed a claim for disability insurance benefits in January 1989,
alleging disability since April 1988 due to pain in the back, left hip, shoulders,
hands and chest and due to depression. The claim was denied administratively (in
June 1991), but Mr. Daniels successfully challenged that denial in his first case
1
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1.9. The case is therefore ordered
submitted without oral argument.
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brought in the district court. Concluding that a post-hearing report submitted by
the Commissioner’s (then, the Secretary of Health and Human Services) medical
expert was “vague and of little objective value,” Appellant’s App. Vol. II at 208,
204, the district court remanded the case in April 1993 for testimony by the
expert at a supplemental hearing. For reasons unclear from the record, the case
was not remanded by the Appeals Council to the Administrative Law Judge (ALJ)
until July 1994, and the supplemental hearing was not held until December 1995. 2
The ALJ issued his decision denying benefits in February 1996, and that decision
became the final decision of the Commissioner when the Appeals Council denied
review in July 1996.
The ALJ found that Mr. Daniels was severely impaired due to shoulder,
back and pulmonary problems, that he did not have a listed impairment, that he
could perform the full range of light work, but that he could not perform his past
relevant heavy work mounting tires and lubricating cars. The ALJ then turned to
the grids, making the following findings:
8. The claimant was under 55 years of age at all times before his
insured status expired, defined as approaching advanced age
(20 CFR 404.1563).
9. The claimant has completed high school. (20 CFR 404.1564).
2
The medical expert was not available to testify, so the parties agreed not to
consider the expert’s earlier written report. Mr. Daniels and a vocational expert testified
at the second hearing.
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10. The claimant is evaluated as if he does not have any acquired
work skills which are transferable to the skilled or semiskilled
work functions of other work (20 CFR 404.1568).
11. Based on an exertional capacity for light work, and the
claimant’s age, education, and work experience, section
404.1569 and Rule 202.14, Table No. 2, Appendix 2, Subpart
P, Regulations No. 4 would direct a conclusion of “not
disabled.”
12. The claimant’s capacity for light work had not been
significantly compromised by any additional limitations.
Accordingly, using the above cited rule as a framework
for decisionmaking, the claimant was not disabled.
13. The claimant was not under a “disability,” as defined in
the Social Security Act at any time through December
31, 1992, at which time his insured status expired, and
therefore at any time though the date of this decision.
(20 CFR 404.1520(f)).
Appellant’s App. Vol. II at 196. 3
On appeal, Mr. Daniels raises two issues. First, he contends that in
violation of 20 C.F.R. § 404.1563, the ALJ mechanically applied the grids’ age
category and failed to consider the fact that he was only sixty-five days short of
his fifty-fifth birthday at the relevant time (i.e., when his insured status expired).
Had the ALJ applied the next higher age category, Mr. Daniels would have been
presumptively disabled. See App. 2, Rule 202.06. Second, he contends that the
ALJ’s pain and credibility analysis is not supported by substantial evidence
3
Although the ALJ stated that he used the grids as a “framework,” it is clear he
relied solely on the grids in finding Mr. Daniels not disabled.
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because the ALJ did not link his conclusions to specific evidence, as he contends
is required by Kepler v. Chater , 68 F.3d 387 (10th Cir. 1995). We review the
Commissioner’s decision to determine whether his factual findings are supported
by substantial evidence and whether he correctly applied the relevant legal
standards. See Castellano v. Secretary of Health & Human Servs. , 26 F.3d 1027,
1028 (10th Cir. 1994).
II.
A.
Because the ALJ found that Mr. Daniels’ impairments prevented him from
performing his past relevant work, this case reached the fifth step of the
sequential process for determining disability, at which point the Commissioner
had the burden of showing Mr. Daniels could perform other work that exists in
the national economy. See, e.g. , Williams v. Bowen , 844 F.2d 748, 751 (10th Cir.
1988). One of the ways the Commissioner can meet this burden is through use of
the grids. See id. at 751-52. The grids are matrices of the “four factors identified
by Congress--physical ability, age, education, and work experience--and set forth
rules that identify whether jobs requiring specific combinations of these factors
exist in significant numbers in the national economy.” Heckler v. Campbell , 461
U.S. 458, 461-62 (1983) (footnotes omitted). The grids thus may provide a
shortcut in certain circumstances to determining whether a claimant can perform
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other work by obviating the need for a vocational expert’s testimony. See Trimiar
v. Sullivan , 966 F.2d 1326, 1332 (10th Cir. 1992).
Through the grids, the Secretary has taken administrative notice of
the number of jobs that exist in the national economy at the various
functional levels ( i.e. , sedentary, light, medium, heavy, and very
heavy). App. 2, § 200.00(b). “Where the findings of fact made with
respect to a particular individual’s vocational factors and residual
functional capacity coincide with all of the criteria of a particular
rule,” the existence of jobs in the national economy for that claimant
is established, and the rule “directs a conclusion as to whether the
individual is or is not disabled.” Id. § 200.00(a)-(b).
Channel v. Heckler , 747 F.2d 577, 579 (10th Cir. 1984). However, the
Commissioner may not apply the grids “conclusively in a given case unless the
claimant’s characteristics precisely match the criteria of a particular rule.” Id. ; see
also Gossett v. Bowen , 862 F.2d 802, 806 (10th Cir. 1988) (“Automatic
application of the grids is appropriate only when a claimant’s [residual functional
capacity], age, work experience, and education precisely match a grid category.”).
The Commissioner has established three age categories: younger person
(under age fifty), person approaching advanced age (age fifty to fifty-four), and
person of advanced age (age fifty-five and over). See 20 C.F.R. § 404.1563. For
this case, the relevant categories are approaching advanced age and advanced age.
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Mr. Daniels was nearly fifty-five years old at the time his insured status ended, 4
and thus falls near the cutoff between the two categories. The difference between
the two categories is subtle but critical. The regulations provide that “[i]f you are
closely approaching advanced age (50-54), we will consider that your age , along
with a severe impairment and limited work experience, may seriously affect your
ability to adjust to a significant number of jobs in the national economy.”
§ 404.1563(c) (emphasis added). In contrast, “[w]e consider that advanced age
(55 or over) is the point where age significantly affects a person’s ability to do
substantial gainful activity .” § 404.1563(d) (emphasis added).
By necessity, the lines drawn between the categories may be arbitrary, but
that does not make the categorization impermissible. Cf. Califano v. Aznavorian ,
439 U.S. 170, 174 (1978) (“Social welfare legislation, by its very nature, involves
drawing lines among categories of people, lines that necessarily are sometimes
arbitrary. This Court has consistently upheld the constitutionality of such
classification in federal welfare legislation where a rational basis existed for
Congress’ choice.”). Moreover, in an attempt to alleviate some of the arbitrariness
4
Because disability must be shown by expiration of insured status, see Henrie v.
United States Dep’t of Health & Human Servs., 13 F.3d 359, 360 (10th Cir. 1993), the
last day of Mr. Daniels’ insured status (December 31, 1992) is the appropriate date for
determining applicability of the grids.
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of the age categories, § 404.1563(a) provides a means of softening the edges of
those categories:
We explain in detail how we consider your age as a vocational factor
in appendix 2. However, we will not apply these age categories
mechanically in a borderline situation.
See Kirk v. Secretary of Health & Human Servs. , 667 F.2d 524, 532 (6th Cir.
1981) (noting that “[i]n line with the Secretary’s acknowledgement [of the
inherent difficulty in drawing precise age classifications], the regulations
specifically provide that age cut-off lines are not to be applied mechanistically”).
In the comments accompanying the promulgation of this regulation’s
predecessor, the Commissioner explained that agency “‘practice over the years, in
fact, has been in agreement with the comment that the passage of a few days or
months before the attainment of a certain age should not preclude a favorable
disability determination.’” Kane v. Heckler , 776 F.2d 1130, 1133 (3d Cir. 1985)
(quoting 43 Fed. Reg. 55349, 55359 (1978)). As we noted in Lambert v. Chater ,
96 F.3d 469, 470 (10th Cir. 1996), the Commissioner later repeated this notion
when explaining what a borderline situation is: “A ‘borderline situation’ exists
when there would be a shift in results caused by the passage of a few days or
months.” Social Security Ruling 82-46c, 1982 WL 31427, at *6 (quotation
omitted); see also id. n.4 (“In the case of a borderline situation, the Secretary is
directed to apply the guidelines flexibly to avoid dramatic shifts in results.”).
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As it applies to this case, § 404.1563(a) raises several questions. First,
what is a borderline situation? Second, who has the burden of showing that a
borderline situation exists or, stated differently, that the age categories should not
be applied mechanically? And third, what does “not applying the age categories
mechanically” mean?
B.
Although the Commissioner has expressly refused to further define what a
borderline situation is, see Social Security Ruling 83-10, 1983 WL 31251, at *8
(“No fixed guidelines as to when a borderline situation exists are provided since
such guidelines would themselves reflect a mechanical approach.”), we do have
his general guidance that it is a factor solely of the claimant’s age and exists
when the claimant is within “a few days or months” of the next category.
Whatever the full extent of that range may be, we conclude that claimant here,
who was only sixty-five days short of the advanced age category, does fall within
the borderline situation. Compare, e.g. , Kane , 776 F.2d at 1132-33 (48 days
before next age category within borderline situation); Ford v. Heckler , 572 F.
Supp. 992, 994 (E.D.N.C. 1983) (two months within borderline); Hilliard v.
Schweiker , 563 F. Supp. 99, 101-02 (D. Mont. 1983) (less than three months
within borderline); Hill v. Sullivan , 769 F. Supp. 467, 471 (W.D.N.Y. 1991)
(three months, two days within borderline), with Underwood v. Bowen , 828 F.2d
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1081, 1082 (5th Cir. 1987) (ten months not within borderline); Lambert , 96 F.3d
at 470 (seven months not within borderline). But see Crady v. Secretary of Health
& Human Servs. , 835 F.2d 617, 618-19, 622 (6th Cir. 1987) (age within
approximately one month of next category not necessarily within borderline).
C.
Mr. Daniels’ primary argument on appeal is that the Commissioner failed to
apply § 404.1563(a). Nonetheless, in his response brief, the Commissioner never
addresses whether claimant’s age places him in the borderline situation, nor,
surprisingly, does he even cite § 404.1563(a). Instead, relying primarily on
Reeves v. Heckler , 734 F.2d 519 (11th Cir. 1984), the Commissioner argues that
Mr. Daniels had the burden of showing he should be classified in the higher age
bracket, and that he failed to meet this burden. 5
Under Reeves and its progeny,
5
The Commissioner also makes two other arguments we find unpersuasive. First,
the Commissioner contends that the grids in general, and the age categories in particular,
are constitutional and not arbitrary and capricious, and that “[t]o successfully challenge
the Grids, appellant must demonstrate that no reasonable basis exists for the distinctions
drawn because unless the limitation imposed by Congress is wholly irrational, it is
constitutional.” Appellee’s Br. at 7 (quotation omitted). Mr. Daniels, however, is not
challenging the grids or age categories themselves; he is simply asking that the
Commissioner apply one of his own regulations, about which there is no question of
constitutionality or arbitrariness.
The Commissioner also argues that what constitutes a borderline situation is
subject to his discretion. See id. at 6-7. To the extent that the Commissioner means that
he is authorized to define what a borderline situation is, that may be true, and he has
(continued...)
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regardless of whether a claimant is in a borderline situation, he may show that his
chronological age category should not apply:
In discharging [the step-five] burden the Secretary may use the age
factor as applied in the grids as evidence of the claimant’s ability to
adapt to a new work environment, but this age factor shall not be
conclusive. If the claimant then proffers substantial credible
evidence that his ability to adapt is less than the level established
under the grids for persons his age, the Secretary cannot rely on the
age factor of the grids and must instead establish the claimant's
ability to adapt to a new work environment by independent evidence.
Cf. Texas Department of Community Affairs v. Burdine , 450 U.S.
248 . . . (1981) (establishing a tripartite scheme of burden of
production in Title VII cases). Applied specifically to this case, this
burden of production scheme allows the Secretary to rely in the first
instance on the age grids, but, if Reeves introduces evidence that his
ability to adapt is more limited than that presumed by the grids for 37
year-olds, the Secretary must prove Reeves’s ability to adapt by other
evidence.
Reeves , 734 F.2d at 525-26.
5
(...continued)
defined it solely to be a factor of age. To the extent that he means that the ALJ in this
case exercised his discretion in determining that Mr. Daniels did not fall within the
borderline, we disagree. The ALJ never addressed the issue of whether Mr. Daniels fell
within the borderline or whether he should be considered in the next age bracket.
Determining whether a claimant falls within a borderline situation appears to be a factual
rather than discretionary matter, and the ALJ erred by not making the necessary factual
finding. See, e.g., Winfrey v. Chater, 92 F.3d 1017, 1026 (10th Cir. 1996). Even were
this considered a discretionary matter, the ALJ would have abused that discretion by
failing to exercise it. Cf. Ohlander v. Larson, 114 F.3d 1531, 1537 (10th Cir. 1997), cert.
denied, 118 S. Ct. 702 (1998).
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Whatever the merits of this position outside the borderline area, 6
we find it
inapplicable to borderline situations because it ignores § 404.1563(a). Applied to
borderline situations, this position essentially places the burden on a claimant to
prove why the grids should not be applied mechanically. Nothing in
§ 404.1563(a) supports this position. The regulation provides that once it is
determined that a claimant is in a borderline situation, which, as noted earlier, the
Commissioner has defined solely in terms of age relative to the next category,
“We”-- meaning the Social Security Administration--“ will not apply these age
categories mechanically. ” The Commissioner’s argument rewrites the regulation
to say essentially that “in borderline situations, we will allow you--the claimant--
to prove why the grids should not be applied mechanically.” The plain language
of the regulation does not allow this interpretation.
Moreover, placing the burden on the Commissioner of determining in the
first instance what age category to apply is consistent with the Commissioner’s
existing burdens. Application of § 404.1563(a) is a step-five issue, and the
burden generally is on the Commissioner at step five. See Williams , 844 F.2d at
751. Additionally, as the Third Circuit has emphasized in this context, it is the
Commissioner’s burden to show that a claimant’s characteristics precisely match
6
We expressed concern about the validity of this rule, outside the borderline
situation, in Lambert, 96 F.3d at 470.
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those of the grids. See Kane , 776 F.2d at 1132-34. Kane noted that in upholding
a challenge to the grids on the basis that they were arbitrary and capricious and
inconsistent with the Social Security Act’s assurance of individual consideration,
the Supreme Court “relied on the guarantee that ‘[i]f an individual’s capabilities
are not described accurately by a rule, the regulations make clear that the
individual’s particular limitations must be considered.’” Id. at 1133-34 (quoting
Campbell , 461 U.S. at 462 n.5). The court also recognized Campbell ’s reference
to § 404.1563(a) and its statement that “‘[t]hus, the regulations provide that the
rules will be applied only when they describe a claimant’s abilities and limitations
accurately.’” Id. at 1134 (quoting Campbell , 461 U.S. at 462 n.5). Kane then
concluded that
[i]n sum, courts recognize that the grids provide useful
standards and allow for consistent, less complex decision-making.
But judicial approval of these standards is premised on the assurance
that [the Social Security Administration] will not employ them to
produce arbitrary results in individual cases. Where a procrustean
application of the grids results in a case that, but for the passage of a
few days, would be decided differently, such an application would
appear to be inappropriate. Section 404.1563(a) therefore serves an
important purpose in the regulatory scheme, and ALJs should adhere
to its clear language.
776 F.2d at 1134. Whether the existence of § 404.1563(a) was critical to judicial
approval of the grids is of no moment for present purposes. 7
What is critical is
7
Campbell indicated that one circuit, the Eleventh in Broz v. Schweiker, 677 F.2d
(continued...)
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the fact that in a borderline situation, such as we have here, § 404.1563(a) plainly
precludes mechanical application of the age categories, that is, simply considering
the chronological age of the claimant at the relevant time. Failing to consider the
effect of a borderline situation in turn precludes application of the grids as a basis
for finding no disability, because the Commissioner will not have shown that “the
claimant’s characteristics precisely match the criteria of a particular rule.”
Channel , 747 F.2d at 579. The ALJ here failed to do that, and therefore should
not have relied on the grids for his decision. As a result, we conclude that the
Commissioner misapplied the law and that the case must be remanded for further
consideration of this issue. 8
D.
7
(...continued)
1351 (11th Cir.1982), had found the age categories arbitrary, but the Court noted that it
did not have to address that issue. 461 U.S. at 464 n.8. The Court subsequently vacated
Broz in light of Campbell, see Heckler v. Broz, 461 U.S. 952 (1983), and the Eleventh
Circuit then reaffirmed it, 711 F.2d 957, and modified it, 721 F.2d 1297 (11th Cir.1983).
Reeves was the Eleventh Circuit’s first decision dealing with the age factor in light of
Broz. See Reeves, 734 F.2d at 525-26.
8
Alternatively, the district court held that even if Mr. Daniels were considered to be
in the “advanced age” category, he would be considered not disabled under Rule 202.07
of the grids. That rule, however, requires a finding that the claimant possess transferable
skills, and the ALJ did not find that Mr. Daniels had such skills. Because a reviewing
court may not reweigh the evidence, see Hinkel v. Apfel, 132 F.3d 1349, 1351 (10th Cir.
1997), the district court’s reliance on Rule 202.07 was inappropriate.
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That leads to the final question--what does not applying the age categories
mechanically mean? The Commissioner has provided virtually no guidance on
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this point, 9 but again, we think Kane generally answered this question
appropriately:
9
Ironically, the only guidance of which we are aware that the Commissioner has
provided related to this matter is his issuance of an Acquiescence Ruling critical of one of
Reeves’ progeny, Patterson v. Bowen, 799 F.2d 1455 (11th Cir. 1986). Patterson is not a
§ 404.1563(a) or borderline case, but it does discuss Reeves’ rule prohibiting mechanical
application of the age categories. See 799 F.2d at 1458-59. As the Commissioner
described the holding in this case, “[t]he Patterson court concluded that evidence of
physical or mental impairments is relevant to the question of a claimant’s ability to adapt
to a new work environment and must be used to help establish that a person’s ability to
adapt is less than the level established under the medical-vocational guidelines for
claimants of that age.” Acquiescence Ruling 88-1 (11), issued January 29, 1988, 1988
WL 236018, at *3. The ruling explained how this differed from agency policy:
The Social Security Administration (SSA) considers medical and
other evidence relating to a claimant’s ability to perform work-related
functions despite his or her physical/mental impairments in its assessment
of residual functional capacity. Therefore, SSA does not use evidence of a
claimant’s physical or mental impairments a second time for the purpose of
deciding that the claimant’s ability to adapt to new work in terms of age
alone is greater or less than that of others of that age. SSA believes that to
do so is to give double weight to the same evidence in deciding whether or
not a claimant is disabled.
Id. Although the ruling states that “SSA intends to clarify the regulation at issue in this
case [apparently referring to § 404.1563] through the rulemaking process,” id., we are
unaware of any subsequent clarification.
Patterson addressed the agency’s position subsequently reflected in Acquiescence
Ruling 88-1, and concluded that “[i]f the Secretary's position on appeal (that evidence of
physical and mental impairments is irrelevant to the ability to adapt issue) were accepted,
it is difficult to understand how a claimant could establish that his ability to adapt to a
new job is less than that presumed under the grids for a person his age.” 799 F.2d at 1459
n.5. Patterson makes a good point--what evidence is relevant to the ability-to-adapt
question? That question is not before us, and we leave it for another day.
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According to the regulatory description of the age factor, the
important difference between those of advanced age and those
closely approaching advanced age is that the age of persons in the
former category “significantly affects a person’s ability to do
substantial gainful activity,” while the age of those in the latter
category merely “seriously affect[s their] ability to adjust to a
significant number of jobs in the national economy.”
[20 C.F.R.] § 404.1563(c), (d). The ALJ must consider which of
these rules better described Kane’s abilities on December 31, 1979,
given the claimant’s actual age and circumstances on that date.
776 F.2d at 1134. However, we do not agree with Kane that the fact that a
claimant falls within a borderline situation necessarily precludes reliance on the
grids. See id. (after determining which category claimant should be in, “ALJ may
then use the grids primarily as a guide in making the disability determination.”);
see also Gonzalez v. Secretary of Health & Human Servs. , 784 F.2d 1417, 1420
(9th Cir. 1986) (holding that vocational expert rather than grids should be used
“where the claimant’s [age] circumstances approach the upper limits of the grid
guidelines”). We see no reason why, if the ALJ determines that based on
whatever evidence is available, the claimant should be classified in a particular
age category, the ALJ cannot then use that category in applying the grids.
To sum up, a borderline situation exists under § 404.1563(a) when a
claimant’s age is within a few days or months of the next higher age category.
When a claimant falls within a borderline, § 404.1563(a) prohibits the
Commissioner from mechanically applying the age categories in relying on the
grids to determine whether a claimant is disabled. The Commissioner must
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determine based on whatever evidence is available which of the categories on
either side of the borderline best describes the claimant, and the Commissioner
may apply that category in using the grids. Like any factual issue, a finding
regarding the appropriate age category in which to place a claimant must be
supported by substantial evidence.
E.
We turn briefly to Mr. Daniels’ second argument on appeal. He contends
that the ALJ’s pain and credibility analysis is not supported by substantial
evidence because the ALJ did not link his conclusions to specific evidence. See
Kepler , 68 F.3d at 390-91. We agree with the district court that while the ALJ’s
assessment of pain and credibility could be better and more thorough, the ALJ did
not commit reversible error.
III.
Because Mr. Daniels’ age placed him within a borderline situation, but the
Commissioner nonetheless applied the age categories mechanically in violation of
§ 404.1563(a), the Commissioner misapplied the law in finding Mr. Daniels not
disabled. Therefore, we must VACATE the judgment of the district court, and
REMAND the case with instructions to remand the matter to the Commissioner
for further proceedings consistent with this opinion.
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