Gilliard v. Kirk, Civ. A. No. 2660.

• Court: United States District Courts. 4th Circuit. Western District of North Carolina
• Citation: 633 F. Supp. 1529
• Docket Number: Civ. A. No. 2660.
• Decision Date: 07 May 1986
• Parties: Beaty Mae GILLIARD; Samuel Odell Davis; Lorraine Gilliard; Loretta Gilliard; Thomas Gilliard; Dana Gilliard; Gregory Gilliard; Reginald Gilliard; and Samuel Davis Jr. Gilliard, minors, by their mother and next friend, Beaty Mae Gilliard, on behalf of themselves and all others similarly situated, Plaintiffs, v. Phillip J. KIRK, Secretary, North Carolina Department of Human Resources, in his official capacity, and C. Barry McCarty, Chairman, North Carolina Social Services Commission, in his official capacity, Defendants and Third-Party Plaintiffs, v. Otis R. BOWEN, M.D., Secretary United States Department of Health and Human Services, Third-Party Defendant.

633 F. Supp. 1529

Beaty Mae GILLIARD; Samuel Odell Davis; Lorraine Gilliard; Loretta Gilliard; Thomas Gilliard; Dana Gilliard; Gregory Gilliard; Reginald Gilliard; and Samuel Davis Jr. Gilliard, minors, by their mother and next friend, Beaty Mae Gilliard, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
Phillip J. KIRK, Secretary, North Carolina Department of Human Resources, in his official capacity, and C. Barry McCarty, Chairman, North Carolina Social Services Commission, in his official capacity, Defendants and Third-Party Plaintiffs,
v.
Otis R. BOWEN, M.D., Secretary United States Department of Health and Human Services, Third-Party Defendant.

Civ. A. No. 2660.

United States District Court, W.D. North Carolina, Charlotte Division.

May 7, 1986.

633 F. Supp. 1530

COPYRIGHT MATERIAL OMITTED

633 F. Supp. 1531

Jane R. Wettach, East Central Community Legal Services, Raleigh, N.C., and Lucie C. White and Jean M. Cary, University of North Carolina School of Law, Chapel Hill, N.C., for plaintiffs

Lemuel W. Hinton and Clifton H. Duke, Asst. Attys. Gen., N.C. Dept. of Justice, Raleigh, N.C., for defendants and third-party plaintiffs.

Charles R. Brewer, U.S. Atty., Charles E. Lyons, Asst. U.S. Atty., Charlotte, N.C., Bruce R. Granger, Regional Atty., and Edgar M. Swindell, Asst. Regional Atty., Dept. of Health and Human Services, Atlanta, Ga., for third-party defendant.

MEMORANDUM OF DECISION

McMILLAN, District Judge.

 TABLE OF CONTENTS
                 Page
                 No
                 I. SUMMARY OF DECISION ---------------------------------------------------- 1532
                II. CASE HISTORY ----------------------------------------------------------- 1533
                III. THE PRESENT CONTROVERSY; THE TEXT OF THE CHALLENGED
                 NEW STATUTE AND REGULATIONS -------------------------------------------- 1533
                 IV. HOW PLAINTIFFS ARE BEING INJURED BY THE NEW STATUTE AND
                 REGULATIONS ------------------------------------------------------------ 1535
                 V. THE CONTROLLING FEDERAL STATUTES AND REGULATIONS NOW
                 REQUIRE THE STATE TO INCLUDE A CHILD RECEIVING ADEQUATE
                 CHILD SUPPORT IN HIS OR HER FAMILY'S AFDC FILING UNIT AND
                 TO COUNT THAT CHILD'S INCOME AS FAMILY INCOME -------------------------- 1543
                 VI. THE LANGUAGE AND LEGISLATIVE HISTORY OF THE 1984 DEFRA
                 AMENDMENT DEMONSTRATE CONGRESSIONAL INTENT TO PREEMPT
                 STATE LAW RESTRICTIONS ON THE USE OF CHILD SUPPORT
                 THAT WOULD PREVENT THE STATE FROM TREATING ONE CHILD'S
                 SUPPORT INCOME AS FAMILY INCOME ---------------------------------------- 1548
                 A. Plaintiffs Have Standing To Challenge Whether Congress Has Pre-Empted
                 State Domestic Relations Law ---------------------------------------- 1549
                 B. State Domestic Relations Laws Are Not Pre-Empted Unless Pre-Emption
                 Is Positively Required By A Direct Federal Enactment ---------------- 1549
                 C. The Language And Legislative History Of DEFRA Demonstrate That
                 Congress Did Intend To Pre-Empt State Law --------------------------- 1550
                VII. THE FEDERALLY SANCTIONED STATE REQUIREMENT THAT
                 MOTHERS SEEKING AFDC FOR THEIR UNSUPPORTED CHILDREN
                 MUST ASSIGN TO THE STATE THE CHILD SUPPORT RIGHTS OF AN
                 ADEQUATELY SUPPORTED CHILD UNCONSTITUTIONALLY DEPRIVES
                 THE SUPPORTED CHILD OF PROPERTY. WHEN THE STATE
                 COOPERATES WITH A FEDERAL PLAN TO COMPEL A MOTHER TO
                 SURRENDER ONE CHILD'S INCOME SO THAT THE REMAINING CHILDREN
                 CAN SURVIVE ON AFDC, THE STATE TAKES PROPERTY FROM
                 THE CHILD'S TRUSTEE AND IMPOSES AN UNCONSTITUTIONAL TAX
                 ON THE SUPPORTED CHILD'S MEMBERSHIP IN A PARTICULAR TYPE
                 OF FAMILY UNIT. THE STATE THUS BECOMES THE FEDERAL GOVERNMENT'S
                 PARTNER IN A TAKING --------------------------------------------------- 1551
                

633 F. Supp. 1532
                 A. The Child Receiving Adequate Child Support Suffers A Loss Of Property
                 As A Result Of The Enforcement Of The SFU Regulations --------------- 1551
                 B. By Pre-Empting State Law Restrictions On The Use And Distribution Of
                 Child Support Paid By A Father For The Benefit Of His Child, DEFRA
                 Becomes The Instrument Of A Taking ---------------------------------- 1553
                 C. A Taking Can Occur When Regulation Reshapes A Property Right -------- 1553
                 D. Even If Congress Has Failed To Pre-Empt Those Elements Of State Law
                 That Would Deny The State Access To The Child Support Income Of An
                 Adequately Supported Child Living With His Or Her AFDC Dependent
                 Family, The State Has Forced Mothers To Surrender The Child's Property
                 To The State In Violation Of The State's Own Laws ------------------ 1555
                VIII. A DEPRIVATION OF PROPERTY THAT SIMULTANEOUSLY INFLICTS
                 DAMAGE ON A FUNDAMENTAL INTEREST, FAMILY AUTONOMY
                 TRIGGERS SPECIAL JUDICIAL SCRUTINY OF GOVERNMENT ACTION
                 CAUSING SUCH INJURIES -------------------------------------------------- 1555
                 A. Whether Accomplished By Means Of Federal Pre-Emption Or Otherwise,
                 The Expropriation Of The Supported Child's Property In Order To
                 Reduce Governmental Expenditures Punishes The Child For Exercising
                 The Child's Fundamental Right To Live With His Or Her Family -------- 1557
                 B. The Supported Children Should Not Be Penalized For Their Mother's
                 Alleged Past Breaches Of A Fiduciary Duty --------------------------- 1557
                 C. The DEFRA Scheme Endangers Family Integrity And Undermines The
                 Well-Being Of Family Members ---------------------------------------- 1558
                 D. The DEFRA/SFU Plan Contradicts Existing Incentives For Fathers To
                 Recognize And Honor Their Duty To Support Their Children ------------ 1559
                 E. By Forcing The Realignment Of Parental Duties, The Federal And State
                 Governmental Actions Weaken The Underpinnings Of Family Life -------- 1562
                 F. Though The Reduction Of Governmental Deficits Is An Important Objective
                 Worthy Of Legislative Attention, The Constitution Should Not Permit
                 Family Duties To Be Destroyed So That Federal Dollars Can Be
                 Saved --------------------------------------------------------------- 1563
                IX. THE RELIEF THAT IS DUE --------------------------------------------------- 1563
                 X. CONCLUSION --------------------------------------------------------------- 1564
                

I. SUMMARY OF DECISION

Plaintiffs are children of low income mothers. They bring this suit through their mother and next friend, on behalf of themselves and similarly situated persons. Not all the children of each mother have the same father. Some of the children are "needy," and have been receiving AFDC (Aid to Families with Dependent Children) payments. Some of the children are not "needy" because their absent fathers are making adequate child support payments to the mother.

The state defendants, acting under a rational interpretation of pertinent recent federal statutes and regulations, are "deeming" the support payments from absent fathers to be income available to all the dependent children in the house. Defendants are cutting off or reducing AFDC payments accordingly, with tragic results shown by the evidence.

This is an unlawful "taking" of the child's income from an absent father. It also unlawfully deprives the other children in the family of AFDC benefits by destroying or reducing their entitlement because one of the mother's children who has income of his or her own exercises his or her right to live in the mother's family unit.

Regardless of whether federal pre-emption in a technical sense has occurred, the federal scheme has, in fact, overpowered

633 F. Supp. 1533

state family law, and has undermined traditional understandings of family values and duties.

Plaintiffs seek an end to the "deeming" practice. They are entitled to relief.

II. CASE HISTORY

This case has been here before. In Gilliard v. Craig, 331 F.Supp. 587 (W.D.N. C.1971) (three judge court), this court enjoined the state defendants from reducing or withholding "the payment of AFDC Aid to Families with Dependent Children benefits ... because of the presumed availability to an AFDC family of child support payments which belong to one or more but not all members of that family." Id. at 593-94. That decision was appealed to the Supreme Court and was affirmed. 409 U.S. 807, 93 S.Ct. 39, 34 L.Ed.2d 66 (1972), reh. den., Craig v. Gilliard, 409 U.S. 1119, 93 S.Ct. 892, 34 L.Ed.2d 704 (1973). The 1971 injunction remains in effect because it has not been stayed, vacated, withdrawn or reversed. Walker v. City of Birmingham, 388 U.S. 307, 313-14, 87 S.Ct. 1824, 1828, 18 L.Ed.2d 1210 (1967); United States v. United Mine Workers of America, 330 U.S. 258, 293-14, 67 S.Ct. 677, 695-06, 91 L.Ed. 884 (1947); Wright v. Jackson, 522 F.2d 955, 958 (4th Cir.1975). Consequently, the state defendants remain subject to the commands of the original injunction pending modification or reversal. Pasadena City Board of Education v. Spangler, 427 U.S. 424, 439-40, 96 S.Ct. 2697, 2706, 49 L.Ed.2d 599 (1976).

The 1971 class of plaintiffs was

"persons who have been or may be subject to a reduction of AFDC (Aid to Families with Dependent Children) benefits based upon unconstitutional or illegal claim of credit by administering agencies for outside income and other resources available to some but not all of a family group."

Gilliard v. Craig, supra, at 588.

The plaintiffs (movants) are members of the same class that was granted relief in 1971. They have filed a motion for further relief, seeking the same sort of relief that was ordered in 1971.

III. THE PRESENT CONTROVERSY; THE TEXT OF THE CHALLENGED NEW STATUTE AND REGULATIONS

On October 10, 1984, the state defendants put into effect a set of new regulations ("Standard Filing Unit" or "SFU" regulations) reading, in pertinent part, as follows:

Standard Filing Unit

A. The parent and all minor children who are brothers and sisters, including half-brothers and sisters, and who are living together must be included in the same assistance unit unless:

1. The parent or child is an SSI recipient, or

2. The parent or child does not meet all eligibility factors with the exception of income and reserve. Do not exclude a parent or child because of the amount of income or reserve he has.

Section 2360 III A, State...