State ex rel. Dept. of Human Services by Adkins v. Huffman

• Decision Date: 11 July 1985
• Docket Number: No. CC947,CC947
• Citation: 175 W.Va. 401,332 S.E.2d 866
• Court: West Virginia Supreme Court
• Parties: STATE of West Virginia, ex rel. DEPARTMENT OF HUMAN SERVICES, by Caroline S. ADKINS v. Gene HUFFMAN.

Page 866

332 S.E.2d 866

175 W.Va. 401

STATE of West Virginia, ex rel. DEPARTMENT OF HUMAN SERVICES, by Caroline S. ADKINS v. Gene HUFFMAN.

No. CC947.

Supreme Court of Appeals of West Virginia.

Submitted April 30, 1985.

Decided July 11, 1985.

Syllabus by the Court

1. "The State Department of Welfare has standing to enforce support obligations assigned to the State pursuant to W.Va.Code 9-3-4 [1979]." Syl.Pt. State ex rel. State Department of Welfare v. Smith, 166 W.Va. 495, 275 S.E.2d 918 (1981).

2. The Department of Human Services receives only those rights to recoupment of benefits paid under the Aid to Families with Dependent Children Program (AFDC) that an AFDC recipient could assign: the recipient's right to support and maintenance. That right to support and maintenance is dependent upon the ability of the responsible relative to pay, and the determination of ability to pay must be made through an administrative hearing or court proceeding.

Daniel F. Hedges, Charleston, for defendant.

Mary Beth Kershner, Asst. Atty. Gen., John T. Yeary, Dept. of Human Services, Office of Child Support Enforcement, Charleston, for plaintiff.

NEELY, Chief Justice:

Gene Huffman married Becky Huffman on 22 November 1972. This marital congress produced three children--children whom the State would support when Gene Huffman abandoned his family from 7 November 1981 until April of 1984. After the Huffman's reunited, the Department of Human Services tried to recoup $7,139 in Aid to Families with Dependent Children (AFDC) benefits that it had paid to Becky to support the children during Gene's absence. Today we decide what procedures the West Virginia Department of Human Services may use to recoup AFDC benefits from a recalcitrant but perhaps indigent father. Although we find the Department of Human Services' goals well meaning, and their efforts sincere, we must limit the Department's debt collection procedures to those that comport with federal and state law.

The Department of Human Services brought a complaint against Gene Huffman in the Lincoln County Circuit Court in July of 1984. The complaint sought to recover $7,139 of AFDC benefits from Gene Huffman pursuant to W.Va.Code 48-7-3 [1983] and W.Va.Code 9-3-4 [1979]. After a hearing, the Circuit Court of Lincoln County held that in the absence of a court order fixing support or an administrative hearing fixing the amount of support that a responsible parent is able to pay, there is no basis for a judgment against such a parent for federal AFDC benefits paid by the state. Because of the novel question of law involved the circuit court certified the following question to this Court.

Whether the West Virginia Department of Human Services can legally obtain a judgment against a parent or other relative for reimbursement to the state for AFDC benefits paid absent a prior court order or administrative determination fixing an amount of support that the parent is able to pay?

The circuit court answered this question correctly when it held that the Department of Human Services has an obligation to comply with federal regulations, and that in the absence of a court order fixing support or an administrative hearing fixing the amount of support that a responsible relative is able to pay before imposition of liability, there is no basis for a judgment against the responsible relative for federal AFDC benefits paid.

I

W.Va.Code 9-3-4 [1979] ¹ assigns the rights to support obligations of any recipient of financial assistance under the program of state and federal assistance established by Title IV of the Federal Social Security Act of 1965. Assigning one's right to support obligations is a prerequisite to receiving assistance under the AFDC program. Furthermore, W.Va.Code 9-3-4 [1979] provides that the Department of Human Services stands in the place of, and succeeds to all the legal rights and remedies of, a parent or guardian to maintain an action to enforce these rights. The pertinent part of W.Va.Code 9-3-4 [1979] reads as follows:

The assignment hereunder shall subrogate the Department of Welfare to the rights of the child, children or caretaker to the prosecution or maintenance of any action or procedure under law providing a remedy whereby the Department of Welfare may be reimbursed for moneys expended on behalf of the child, children or caretaker. The department of welfare shall further be subrogated to the debt created by any order or decree awarding support and maintenance to or for the benefit of any child, children or caretaker included within the assignment hereunder and shall be empowered to receive such money judgments and endorse any check, draft, note or other negotiable document in payment thereof.

This allows the state to stand in the place and stead of the assignor and grants the state a broad right to enforce its claim. And as we have said before:

"[t]he concept of subrogation is distinct from that of mere assignment. Subrogation is a 'creature of equity having for its purpose the working out of an equitable adjustment between the parties by securing the ultimate discharge of a debt by the person who in equity and good conscience ought to pay it.' " quoting 16 Couch, Cyclopedia of Insurance Law, 61: (18 2d Ed.1964), Travelers Indemnity Company v. Rader, 152 W.Va. 699, 704, 166 S.E.2d 157, 160 [1969].

State ex rel. State Department of Welfare v. Smith, 166 W.Va. 495, 275 S.E.2d 918, 920 (1981).

Obviously the Department of Human Services inherits all the rights of the original obligor, but the Department of Human Services does not obtain any more than those rights. Although in some cases those rights may be commensurate with the full amount of AFDC benefits paid out, this is not always the case. The actual amount of AFDC benefits paid to the assignor provides a ceiling and not a floor on state recoupment.

Mrs. Becky Huffman assigned her rights to support and maintenance from Gene Huffman. Accordingly, the Department of Human Services only inherits what original obligations Gene Huffman had to support and maintain his children. Although this obligation may be as large as the payments the Department of Human Services made to Mr. Huffman's wife and children during his absence, the obligation may be smaller if Mr. Huffman himself is indigent. His obligation is limited to the amount he could have paid in support and maintenance.

The Congress anticipated the difficulty and unfairness of collecting moneys from indigent parents when they designed the AFDC program. Congress requires that states that receive moneys for AFDC benefits must provide both a hearing ² and an extensive list of factors to consider before collecting money from the parent. ³ W.Va.Code 9-3-4 [1979] must be read in pari materia with these provisions. W.Va.Code 9-3-4 [1979] anticipates an analogous situation in its provision that limits a parent's debt by the amount established in any court order or final decree of divorce if the amount in such order or decree is less than the amount of assistance paid. In our present case, if the Huffmans had been divorced, Mr. Huffman's liability under W.Va.Code 9-3-4 [1979] would have been limited to the amount he would owe pursuant to W.Va.Code 48-2-16 [1984]; ⁴ the Court would have considered a statutory laundry list of factors before fixing the amount of support and maintenance. Gene Huffman should not lose the benefit of this limitation simply because he did not bother to go through the legal formalities of divorce. The policies that cause us to consider the financial ability of the parties to a divorce are equally present in this case: An individual should not be required to pay more than he is able Miller v. Miller, 114 W.Va. 600, 602, 172 S.E. 893, 894 (1934).

Before the Department of Human Services can collect any amount from Gene Huffman it must first determine the limits of Gene Huffman's support obligation. Gene Huffman is entitled to a hearing to determine his ability to repay the AFDC benefits.

Certified Question Answered.

1 W.Va.Code 9-3-4 [1979] provides:

Any recipient of financial assistance under the program of state and federal assistance established by title IV of the federal Social Security Act of 1965, as amended, or any successor act thereto, shall, upon receipt of such assistance be deemed to have assigned to the West Virginia department of welfare all rights, title and interest such recipient may have to the receipt of support and maintenance moneys from any person responsible for the support and maintenance of any member of the benefit group. Persons responsible for support and maintenance shall include all persons who under the laws of the State of West Virginia owe obligations of support or maintenance to a child or to the caretaker of a child. The assignment contemplated herein shall include all amounts of support and maintenance which shall be accrued to the recipient of assistance and not received and all amounts of support and maintenance which shall accrue during recipient's period of eligibility: Provided, that, subject to applicable federal and state laws, the department of welfare shall be entitled to retain only so much of the support and maintenance as is necessary to reimburse the public assistance...