Paulhe v. Riley

• Decision Date: 05 July 2006
• Docket Number: No. 2005AP2487.,2005AP2487.
• Parties: In re the Marriage of Marcus P. PAULHE, Petitioner-Respondent, v. Monica M. RILEY, p/k/a Monica M. Paulhe, Respondent-Appellant.<SMALL><SUP>†</SUP></SMALL>
• Court: Wisconsin Court of Appeals

722 N.W.2d 155

2006 WI App 171

In re the Marriage of Marcus P. PAULHE, Petitioner-Respondent, v. Monica M. RILEY, p/k/a Monica M. Paulhe, Respondent-Appellant.^†

No. 2005AP2487.

Court of Appeals of Wisconsin.

Submitted on Briefs June 8, 2006.

Opinion Filed July 5, 2006.

On behalf of the respondent-appellant, the cause was submitted on the brief of William W. Moir III of Hopp, Neumann, Humke, L.L.P., of Sheboygan.

On behalf of the petitioner-respondent, the cause was submitted on the brief of William H. Holbrook of Holbrook, Wurtz, Roth, Basler & Brock, L.L.P., of Sheboygan.

An amicus curiae brief was submitted by American Academy of Matrimonial Lawyers-Wisconsin Chapter, Margaret W. Hickey, President, and by Marygold S. Melli, and Carlton D. Stansbury.

Before BROWN, NETTESHEIM and ANDERSON, JJ.

¶ 1 NETTESHEIM, J

The Social Security Administration determined that Marcus P. Paulhe was disabled and therefore paid social security disability benefits to Marcus' former wife, Monica M. Riley, on behalf of the parties' minor child, Abbe. Based on these disability payments, Marcus sought credit against child support payments he had previously made. The family court granted Marcus' request and entered a postjudgment order directing Monica to reimburse Marcus for a portion of the child support payments. Monica appeals.

¶ 2 Monica contends that the order constitutes a retroactive revision of support contrary to WIS. STAT. § 767.32(1m) (2003-04).¹ Monica further contends that the exception set out in § 767.32(1r)(d), which permits retroactive revision of child support based on social security disability benefits in instances of unpaid support does not apply since Marcus had made all of his support payments in a timely fashion. Monica argues that the statute represents the only instance in which credit is allowed.

¶ 3 On a threshold basis, the family court ruled that the order granting Marcus credit did not constitute a revision of the child support order under WIS. STAT. § 767.32(1m). In addition, the court agreed with Monica that § 767.32(1r)(d) was limited to instances of "unpaid support." However, the court noted the illogic and unfairness produced by allowing a credit under § 767.32(1r)(d) to a payor who had failed to make child support payments, but denying such relief to a payor like Marcus who had made all required child support payments. Thus, the court granted Marcus credit against his previously paid support payments for the period of time covered by the social security disability benefits paid to Monica on Abbe's behalf.

¶ 4 We agree that the family court's grant of credit to Marcus did not constitute a revision of the child support order. We also hold, on grounds of both public policy and fairness, that WIS. STAT. § 767.32(1r)(d) should not be construed to bar credit in a situation where a child support payor has made all requisite support payments. Our holding avoids an interpretation of § 767.32(1r)(d) which likely would create an equal protection violation. As the result of our decision, Wisconsin joins the majority of other jurisdictions that have addressed the issue before us.

Amicus Curiae Brief of the American Academy of Matrimonial Lawyers—Wisconsin Chapter

¶ 5 At the outset, we express our appreciation to the Wisconsin chapter of the American Academy of Matrimonial Lawyers for its participation in this appeal as amicus curiae.² In particular, we thank Attorneys Margaret W. Hickey, Marygold S. Melli and Carlton D. Stansbury, members of the Academy and coauthors of the amicus brief, who have provided us with a cogent analysis of the appellate issue. We borrow liberally from the amicus brief in this opinion.

Facts

¶ 6 The facts of this case are straightforward and undisputed. Monica and Marcus were divorced in September 1989. Monica was awarded custody of the parties' then three minor children, and Marcus was ordered to pay support. Over time, the two eldest children attained majority, resulting in an October 2004 stipulated child support order directing Marcus to pay $513.45 per month as child support for Abbe, the remaining minor child.

¶ 7 In February 2005, Marcus filed a motion to revise support based on the fact that he had become totally disabled as of November 2003 and, as a result, Monica had received social security disability benefits on Abbe's behalf. Although Marcus' motion was to "revise" the child support, his actual request was that the family court "credit" the social security disability payments received by Monica against the child support Marcus had previously paid, measured from the date of his disability.³

¶ 8 The evidence at the hearing on the motion established that Marcus, although not employed because of his disability, had income from two sources: (1) his own social security disability benefits in the amount of $1569 per month; and (2) supplemental benefits from a separate disability insurance policy in the amount of $1502.50 per month. In addition, Marcus had received lump-sum social security disability payments in the amount of $13,683 for past-due disability benefits. Similarly, Monica had received a past-due disability lump-sum payment on behalf of Abbe in the amount of $7642 based on Marcus' disability. In addition, Monica was receiving monthly social security disability benefits on behalf of Abbe in the amount of $784. The evidence also established that Marcus had remained current in all of his support payments despite being unemployed.

¶ 9 At the close of the evidence, Monica agreed that Marcus' current support obligation could have been suspended effective February 2005 because the current level of social security disability payments in the amount of $784 per month exceeded Marcus' monthly support obligation. Thus, the issue narrowed to whether Marcus was entitled to credit against his previously paid child support based on the social security disability payments received by Monica on Abbe's behalf for the period from November 2003 to January 2005.

¶ 10 In opposing Marcus' motion, Monica argued that WIS. STAT. § 767.32(1m) bars retroactive revision of a child support order prior to the date that notice of the application is given. However, this rule is subject to the exception set out in § 767.32(1r)(d), which permits retroactive revision of a child support order based on social security disability payments in instances of "unpaid support." Since Marcus had always been current in his child support payments, Monica argued that this exception did not apply.

¶ 11 The family court first ruled that the order granting Marcus' request for credit against his previous support payments did not constitute a revision of the judgment. In addition, the court agreed with Monica that this was not a case of "unpaid support" under WIS. STAT. § 767.32(1r)(d). Nonetheless, the court granted Marcus' request for credit against his previously paid child support on grounds of fairness. As explanation, the court noted the incongruity of Monica's argument, which would allow a credit to a child support payor who had failed to make support payments but deny a credit to a payor who had made support payments despite the disability. Monica appeals.

Discussion

¶ 12 We begin with two very important observations that we will restate a number of times during our discussion. First, social security disability payments are not gratuitous benefits conferred by a benevolent governmental policy. In re Marriage of Henry, 156 Ill.2d 541, 190 Ill.Dec. 773, 622 N.E.2d 803, 808 (1993); see also Potts v. Potts, 240 N.W.2d 680, 681 (Iowa 1976). To the contrary, such payments are more properly characterized as a substitute for the disabled parent's earnings, funded by the parent's payment of social security taxes. Henry, 190 Ill. Dec. 773, 622 N.E.2d at 808-09; see also Williams v. Williams, 88 Ohio St.3d 441, 727 N.E.2d 895, 897 (2000); Potts, 240 N.W.2d at 681. Second, Marcus was current in all of his child support obligations. With these concepts prominently in mind, we turn to the analysis of the issue.

¶ 13 We first state our agreement with the family court's ruling that the order granting credit to Marcus did not constitute a revision of the standing child support order. Although Marcus titled his motion as one to "revise" support, his actual claim for relief was for "credit" against the support he had already paid. In granting that relief, the court did not disturb the standing order for child support. Instead, the court merely recognized that the child support for the period in question had been "double paid"—once via Marcus' direct payments and again via the social security disability benefits paid to Monica on Abbe's behalf based on social security payments Marcus previously had made though his earnings. Going into the hearing, Marcus' child support obligation stood at $513.45 per month; coming out of the hearing, the obligation, although suspended, remained the same.

¶ 14 Next, we address Monica's argument that the grant of credit is barred by WIS. STAT. § 767.32(1r)(d). As noted, this statute permits social security disability payments paid on behalf of a child to be credited against a payor's child support obligation in instances of "unpaid support." Monica argues that this statute represents the sole instance in which credit is permitted and, since Marcus was current in his child support payments and therefore there was no "unpaid support," Marcus was not entitled to any credit.

¶ 15 Monica relies on Burger v. Burger, 144 Wis.2d 514, 424 N.W.2d 691 (1988), where the supreme court held that a payor was entitled to credit for a lump-sum payment on arrears accumulated during a period of disability. Id. at 527, 424 N.W.2d 691. Monica reasons that had the court intended to also allow credit in a situation where, as here, the payor was not in arrears, it would have said so. Monica makes the same argument regarding the legislature's later enactment of WIS. STAT. 767.32(1r)(d), which...