Compton v. Compton

• Decision Date: 03 April 2003
• Citation: 66 P.3d 572,187 Or. App. 142
• Parties: Janice Louise COMPTON, Appellant, v. Ronald Lee COMPTON, Respondent.
• Court: Oregon Court of Appeals

66 P.3d 572

187 Or. App. 142

Janice Louise COMPTON, Appellant, v. Ronald Lee COMPTON, Respondent.

C000745CV; A116533.

Court of Appeals of Oregon.

Argued and Submitted December 13, 2002.

Decided April 3, 2003.

Vincent James Bernabei, Portland, argued the cause and filed the brief for appellant.

David N. Hobson, Jr. argued the cause for respondent. With him on the brief was Hobson & Angell, LLP.

Before EDMONDS, Presiding Judge, and KISTLER and SCHUMAN, Judges.

EDMONDS, P.J.

Plaintiff brought this action to recover money that defendant agreed to pay for support of defendant's granddaughter, Amy. Plaintiff and defendant are Amy's legal guardians. The trial court granted summary judgment to defendant on the ground that the agreement violated public policy. ORCP 47. We reverse.

The relevant facts are undisputed. In 1991, while plaintiff and defendant were married, they became the joint legal guardians of Amy, who thereafter lived with them. In 1998, plaintiff's and defendant's marriage was dissolved. On February 3, 1998, during the process of the dissolution, they entered into a "Guardianship Agreement" (the agreement) concerning Amy's future care. They did not present the agreement to either the dissolution or the guardianship court for its approval. The agreement is the legal basis for plaintiff's claims in this case.

In the agreement, plaintiff and defendant stated that it was in Amy's best interests that they continue as joint guardians, that she live with plaintiff permanently and visit with defendant, and that it would be detrimental for her to be returned to the custody of her natural parents or any member of either of their families. They then agreed that she would live with plaintiff permanently and that defendant would have liberal and unrestricted visitation at mutually agreed times. The agreement contains extensive provisions for Amy's support. The essential section provides that the "parties shall be jointly and severally liable for Amy's care, maintenance and support." The agreement then requires defendant to pay all expenses associated with the residence where plaintiff and Amy lived at the time of the agreement. It also requires defendant, beginning March 1, 1999, or approximately one year after the agreement, to pay plaintiff $425 per month until Amy turns 18, completes high school, marries, is emancipated, or no longer lives with plaintiff, whichever comes first. The parties further agreed that defendant would pay 75 percent of any uninsured medical expenses and that plaintiff would pay 25 percent.¹ Because of her agreement to be jointly and severally liable for Amy's support, plaintiff agreed to be responsible for any other expenses.

Plaintiff filed this case in March 2000, alleging that defendant had not made any of the required payments since June 1999 and that he had indicated that he did not intend to make any future payments. She sought damages of $34,000 as "the entire amount of the unpaid contractual amount."² In response, defendant admitted that he was delinquent under the agreement but denied that the unpaid contractual amount of $34,000 was due and owing. As an affirmative defense, he alleged that the agreement was void as violating public policy on the ground that neither a guardian nor a grandparent has a legal obligation to support a ward or grandchild and that private contracts imposing such an obligation would deter unrelated parties from assisting minors in need. He thereafter moved for summary judgment on that defense, arguing in essence that the agreement was an attempt to remove the issue of Amy's custody and her best interests from the courts in violation of the relevant statutes. The trial court grudgingly agreed that the agreement was unenforceable; it granted defendant's motion and thereafter entered judgment for him.³

"If the consideration for the contract or its agreed purpose is illegal or against public policy on its face, it will not be enforced." Hendrix v. McKee, 281 Or. 123, 128, 575 P.2d 134 (1978). "Such a public policy may be found in legislative enactments, administrative regulations, even in the constitution[.]" A-1 Sandblasting v. Baiden, 293 Or. 17, 22, 643 P.2d 1260 (1982). On appeal, defendant points out that a guardian has no legal obligation to support a minor beyond the support that the minor's estate can provide, ORS 125.315(1)(e), and argues that the agreement is an attempt to impose an obligation of support on defendant in exchange for access to Amy. Such an agreement, according to defendant, violates the public policy that makes custody and visitation matters for the court to decide. He also argues that, because the agreement states that it is "in consideration of the mutual promises and covenants," the various provisions are not severable for the purposes of determining the legality of the agreement.

We consider first defendant's contention that the parties' contract is illegal. Defendant relies on ORS chapter 107 (statutes governing marital dissolution, annulment and separation), ORS chapter 109 (statutes governing parent and child rights and relationships), and ORS chapter 125 (statutes governing guardianships of wards). In Uhlmann v. Kin Daw, 97 Or. 681, 689-90, 193 P. 435 (1920), the Supreme Court explained the controlling principles of law concerning whether an agreement is void because it is made in violation of statute:

"An agreement is illegal if it is contrary to law, morality or public policy: 6 R.C.L. 693. Plain examples of illegality are found in agreements made in violation of some statute; and, stating the rule broadly, an agreement is illegal if it violates a statute or cannot be performed without violating a statute.

"* * * * *

"The rule that an agreement is illegal and unenforceable if it conflicts with the provisions of a statute is not inexorable and unbending. * * * The inquiry is as to the legislative intent, and that may be ascertained, not only by an examination of the express terms of the statute, but it may also be implied from the several provisions of the enactment. Of course, if a statute expressly declares that an agreement made in contravention of it is void, then the inquiry is at an end; but, in the absence of such a declaration, the court may take the statute by its four corners and carefully consider the terms of the statute, its object, the evil it was enacted to remedy, and the effect of holding agreements in violation of it void, for the purpose of ascertaining whether it was the legislative intent to make such agreements void * * *."

None of the cited statutes expressly prohibits the parties' agreement to provide for Amy's support. Because the parties are not her natural parents, ORS chapters 107 and 109 are inapplicable. However, because the parties are her legal guardians, ORS 125.300 to ORS 125.330 are applicable. In particular, ORS 125.315 provides for the general powers and duties of guardians. Those powers and duties include exercising custody over the protected person, establishing the protected person's place of abode, providing for the care, comfort, maintenance, training, and education of the protected person as well as taking care of the protected person's assets and personal effects in the absence of the appointment of a conservator. ORS 125.315(1)(e) provides, in pertinent part:

"The guardian of a minor has the powers and responsibilities of a parent who has legal custody of a child, except that the guardian has no obligation to support the minor beyond the support that can be provided from the estate of the minor[.]"

In defendant's view, ORS 125.315(1)(e) is controlling authority that his contract with plaintiff is illegal. He also points to the fact that the parties did not seek the approval of the court exercising jurisdiction over Amy's guardianship when he and plaintiff entered into their agreement.

ORS 125.315(1)(e) does not declare that a voluntary, private agreement to allocate the costs of support for the protected person is void, and the wording of the statute does not indicate that the legislature intended such agreements to be illegal. Rather, the legislative intent underlying the statute is apparent from its text and context. Although a guardian is charged with providing for the care and maintenance of a protected person, the protected person's estate is, pursuant to the statute, the source of the money needed for maintenance, and the guardian has no statutory obligation to expend his or her personal funds for that purpose. Consequently, we reject defendant's contention that the agreement is illegal because its support provisions cannot be performed without violating the statutes on which he relies.

An agreement may also be illegal because it is contrary to public policy and morality. We perceive nothing immoral about a private agreement between two nonparent guardians to assume and allocate the cost of supporting a protected person. If anything, it is consistent with public policy to encourage nonparents to provide for the support of a minor who is unable to provide for her own support rather than making her dependent on the public for support. Nonetheless, defendant argues that the agreement violates public policy. He explains:

"What Plaintiff essentially sought to do in this case is to require that Defendant pay for the right to have liberal contact with the ward. This type of contract is akin to a surrogacy contract or various `baby selling' contracts. These types of agreements are void as against public policy."

Whether a contract is illegal because it violates public policy must be determined in light of its own particular facts because "public policy" is often difficult to define. Moreover, the freedom of private citizens to make any kind of contract is unrestricted unless it contravenes some "over-powering rule of public policy[.]" Eldridge et al. v. Johnston, 195 Or. 379, 405, 245 P.2d 239 (1952). In determining whether an agreement is void because it is...