The opinion of the court was delivered by: Carla M. Woehrle United States Magistrate Judge
The parties have consented, under 28 U.S.C. § 636(c), to the jurisdiction of the undersigned Magistrate Judge. Plaintiff seeks review of the Commissioner's denial of disability benefits. As discussed below, the court finds that the Commissioner's decision should be reversed and this matter remanded for further proceedings.
Plaintiff Michelle Hill was born on April 22, 1971, and was thirty-seven years old at the time of her administrative hearing. [Administrative Record ("AR") 16, 19.] She has a limited education (tenth grade) and past relevant work experience as a sales attendant and retail sales person. [AR 16, 47, 123.] Plaintiff alleges disability on the basis of depression, bipolar disorder, anxiety attacks, short-term memory problems, difficulty concentrating, feelings of sadness, inability to drive due to phobias, lack of motivation, and plantar fasciitis. [AR 13.]
II. PROCEEDINGS IN THIS COURT
Plaintiff's complaint was lodged on April 17, 2009, and filed on April 24, 2009. On September 29, 2009, Defendant filed an answer and Plaintiff's Administrative Record ("AR"). On November 17, 2009, the parties filed their Joint Stipulation ("JS") identifying matters not in dispute, issues in dispute, the positions of the parties, and the relief sought by each party. This matter has been taken under submission without oral argument.
III. PRIOR ADMINISTRATIVE PROCEEDINGS
Plaintiff applied for a period of disability and disability insurance benefits ("DIB") under Title II of the Social Security Act and supplemental security income ("SSI") under Title XVI on December 22, 2006, alleging disability since September 27, 2005. [AR 9.] Plaintiff is insured for DIB purposes until September 30, 2010. [Id.] After the applications were denied initially and on reconsideration, Plaintiff requested an administrative hearing, which was held on December 18, 2008, before Administrative Law Judge ("ALJ") David M. Ganly. [AR 19-51.] Plaintiff appeared without counsel*fn1, and testimony was taken from Plaintiff, medical expert Joseph Malancharuvil and vocational expert Stephen Berry. [AR 19.] The ALJ denied benefits in a decision issued on January 15, 2009. [AR 9-18.] When the Appeals Council denied review on March 25, 2009, the ALJ's decision became the Commissioner's final decision. [AR 1-3.]
Under 42 U.S.C. § 405(g), a district court may review the Commissioner's decision to deny benefits. The Commissioner's (or ALJ's) findings and decision should be upheld if they are free of legal error and supported by substantial evidence. However, if the court determines that a finding is based on legal error or is not supported by substantial evidence in the record, the court may reject the finding and set aside the decision to deny benefits. See Aukland v. Massanari, 257 F.3d 1033, 1035 (9th Cir. 2001); Tonapetyan v. Halter, 242 F.3d 1144, 1147 (9th Cir. 2001); Osenbrock v. Apfel, 240 F.3d 1157, 1162 (9th Cir. 2001); Tackett v. Apfel, 180 F.3d 1094, 1097 (9th Cir. 1999); Reddick v. Chater, 157 F.3d 715, 720 (9th Cir. 1998); Smolen v. Chater, 80 F.3d 1273, 1279 (9th Cir. 1996); Moncada v. Chater, 60 F.3d 521, 523 (9th Cir. 1995)(per curiam). "Substantial evidence is more than a scintilla, but less than a preponderance." Reddick, 157 F.3d at 720. It is "relevant evidence which a reasonable person might accept as adequate to support a conclusion." Id. To determine whether substantial evidence supports a finding, a court must review the administrative record as a whole, "weighing both the evidence that supports and the evidence that detracts from the Commissioner's conclusion." Id. "If the evidence can reasonably support either affirming or reversing," the reviewing court "may not substitute its judgment" for that of the Commissioner. Reddick, 157 F.3d at 720-721; see also Osenbrock, 240 F.3d at 1162.
A. THE FIVE-STEP EVALUATION
To be eligible for disability benefits a claimant must demonstrate a medically determinable impairment which prevents the claimant from engaging in substantial gainful activity and which is expected to result in death or to last for a continuous period of at least twelve months. Tackett, 180 F.3d at 1098; Reddick, 157 F.3d at 721; 42 U.S.C. § 423(d)(1)(A).
Disability claims are evaluated using a five-step test:
Step one: Is the claimant engaging in substantial gainful activity? If so, the claimant is found not disabled. If not, proceed to step two.
Step two: Does the claimant have a "severe" impairment? If so, proceed to step three. If not, then a finding of not disabled is appropriate.
Step three: Does the claimant's impairment or combination of impairments meet or equal an impairment listed in 20 C.F.R., Part 404, Subpart P, Appendix 1? If so, the claimant is automatically ...