Krause v. State ex rel. Iowa Dept. of Human Services, 87-1233

• Decision Date: 20 July 1988
• Docket Number: No. 87-1233,87-1233
• Citation: 426 N.W.2d 161
• Parties: David L. KRAUSE, Appellee, v. STATE of Iowa ex rel. IOWA DEPARTMENT OF HUMAN SERVICES, Connie L. Krause, on Behalf of Jonathan Krause, and Doris A. Taylor and Daniel C. Williams, As Designee of the Director of the Bureau of Collections, Appellants.
• Court: Iowa Supreme Court

Page 161

426 N.W.2d 161

David L. KRAUSE, Appellee, v. STATE of Iowa ex rel. IOWA DEPARTMENT OF HUMAN SERVICES, Connie L. Krause, on Behalf of Jonathan Krause, and Doris A. Taylor and Daniel C. Williams, As Designee of the Director of the Bureau of Collections, Appellants.

No. 87-1233.

Supreme Court of Iowa.

July 20, 1988.

Thomas J. Miller, Atty. Gen., Gordon E. Allen, Deputy Atty. Gen., Robert R. Huibregtse, Asst. Atty. Gen., and Ralph H. Allen, Asst. Co. Atty., for appellants.

Mark S. Soldat, Algona, for appellee.

Considered by SCHULTZ, P.J., and CARTER, NEUMAN, SNELL, and ANDREASEN, JJ.

CARTER, Justice.

The Iowa Department of Human Services (the agency) appeals from a district court decision which determined that the type of hearing which must be accorded a person liable for child support under Iowa Code section 252C.4 (1985) is an original hearing in the district court rather than a review of administrative action under the provisions of Iowa Code section 17A.19 (1985). Because we agree with the district court's interpretation of the applicable statutes, we affirm its order.

The essential facts of this case are not in serious dispute. Connie L. Krause is the wife and Jonathan is the son of David L. Krause. Connie and David have separated. In December 1985, Connie applied for and began receiving aid to dependent children benefits. On January 15, 1986, the agency, acting through its local child support recovery unit in Fort Dodge, Iowa, gave notice to David that a child support debt was due and owing to the agency as a consequence of the public assistance being provided to a child for whose support he was legally responsible.

The January 15 notice advised David that he owed the agency $172.32 for public assistance previously provided. In addition, it informed him of the agency's intent to record an administrative order with the district court for (a) recoupment of the debt currently owed the agency, and (b) establishing an obligation against David for future child support of not less than $322 per month.

The notice stated that David had a right to "request a negotiation conference" concerning the demand for payment or, in the alternative, "to request a court hearing on this matter even if no conference is requested." Although the notice contained an explanation of how the agency had calculated the debt for past support, it did not indicate how it had determined the proposed future support obligation.

David responded to the notice on January 23, 1986, through his attorney. This response was directed to Ms. Doris Taylor of the Fort Dodge child support office. David offered to make payments of $60 per month and tendered a financial affidavit showing gross monthly income of $1257.01. On January 27, 1986, David, again by counsel, wrote to the agency requesting "a hearing in district court and that the director of the child support recovery unit certify the matter to the district court." This letter also contained objections to the amount of the future monthly child support payments suggested by the agency.

Ms. Taylor responded to this correspondence on January 31, 1986, by acknowledging the request for a court hearing and enclosing a form petition for judicial review of agency action under Iowa Code chapter 17A. She advised David that in order to obtain a hearing this form would need to be completed and filed with the clerk of the district court.

On February 3, 1986, David's counsel replied to Ms. Taylor advising her that it was his belief that it was the agency's responsibility to certify the matter to the district court. This letter further suggested that the hearing to which David was entitled was an original hearing in the district court rather than a judicial review of an administrative determination.

On February 4, 1986, Ralph H. Allen, Assistant County Attorney for Webster County, responded to David's counsel and politely suggested that counsel was misinterpreting Iowa Code section 252C.4. The letter advised that unless David filed a petition for judicial review by February 11, 1986, the agency "will appropriately set the amount of child support." On February 5, 1986, David's counsel responded to the assistant county attorney's letter stating that he continued to believe that it was the responsibility of the agency to implement his request for a hearing by certifying the matter to the district court.

On February 13, 1986, the matter was referred to Gordon Allen, Special Assistant Attorney General, who advised David's counsel in a letter of that same date that the only method to obtain a hearing under section 252C.4 was by a petition for review of agency action filed in the district court by the person who desired the hearing. David's counsel replied to the special assistant attorney general and advised "the point is, of course, that with respect to the issue of support payment, which could be more or less than the amount of the support debt, there is no statutorily authorized agency action which occurs before the court hearing prescribed. Therefore there is no [agency] action from which to be 'aggrieved or adversely affected.' "

Following the latter communication, nothing further transpired before the agency with respect to David's request for a hearing. On February 24, 1986, the agency issued an administrative order calling for reimbursement of past support in the amount of $319.98 and establishing a future monthly support obligation against David of $314 per month. The present case arises on David's petition for judicial review of the February 24 order.

The district court heard arguments on the matter and ruled that the hearing contemplated by sections 252C.3(3) and 252C.4 is an original hearing in the district court, rather than a judicial review of agency action pursuant to chapter 17A. The court ruled that at such a hearing it is incumbent upon the agency to produce sufficient evidence to permit the district court to establish a proper level of support payments under the guidelines set forth in section 252C.10. On this appeal, we consider the agency's arguments as to why it believes that interpretation of the applicable statutes is incorrect.

I. The Type of Hearing to be Accorded Support Obligors Under Iowa Code Section 252C.4.

In seeking reversal of the district court's order, the agency argues that the right to a hearing which is accorded to child support obligors under sections 252C.3(1), (3), and 252C.4 is a judicial review of agency action under the provisions of Iowa Code section 17A.19. It urges that in reaching a contrary interpretation the district court misapplied the applicable statutes.

The statutes under which this controversy arises provide, in part:

1. In the absence of a court order, the director may issue a notice establishing and demanding payment of an accrued or accruing support debt due and owed to the department or an individual under section 252C.2. The notice shall be served upon the responsible person in accordance with the rules of civil procedure. The notice shall include all of the following:

....

f. A Statement that if the responsible person objects to all or any part of the notice or finding of financial responsibility and no negotiation conference is requested, then within twenty days of the date of service, the responsible person shall send to the office of the child support recovery unit which issued the notice a written response setting forth any objections and requesting a hearing.

g. A statement that if a timely written request for a hearing is received by the office of the child support recovery unit which issued the notice, the responsible person shall have the right to a hearing to be held in district court; and that if no timely written response is received, the director may enter an order in accordance with the notice and finding of financial responsibility.

Iowa Code §§ 252C.3(1)(f), (g) (1985) (emphasis added). Following these provisions, the statute continues as follows:

3. If a timely written response setting forth objections and requesting a hearing is received by the appropriate office of the child support recovery unit, a hearing shall be held in district court.

4. If timely written response and request for hearing is not received by the appropriate office of the child support recovery unit, the director may enter an order in accordance with the notice....

Iowa Code §§ 252C.3(3), (4) (emphasis added). Also relevant to the inquiry is the very next section in the Code which provides:

1. If a timely written request for a hearing is received, the director shall certify the matter to the district court in the county in which the order has been filed, or if no such order has been filed, then to a district court in the county where the dependent child resides.

2. If the matter has not been heard previously by the district court, the certification shall include true copies of the notice and finding of financial responsibility or notice of the support debt accrued and accruing, the return of service, the written objections and request for hearing, and true copies of any administrative orders previously entered.

3. The court shall set the matter for hearing and notify the parties of the time and place of hearing.

4. The court shall consider the schedule of minimum support guidelines in section 252C.10 in establishing the monthly support payment and the amount of the support debt accrued and accruing.

5. If a party fails to appear at the hearing, upon a showing of proper notice to that party, the court may find that party in default and enter an appropriate order.

Iowa Code § 252C.4 (1985) (emphasis added).

The basic premise underlying the agency's argument is that the subject matter of the requested hearing necessarily involves a review of agency action as that term was recognized and applied in Polk County v. Iowa State Appeal Board, 330 N.W.2d 267, 276-77 (Iowa 1983). It urges, therefore, that the judicial review...