State Treasurer v. Schuster, Docket No. 168057

• Court: Court of Appeal of Michigan (US)
• Writing for the Court: MICHAEL J. KELLY
• Citation: 215 Mich.App. 347,547 N.W.2d 332
• Docket Number: Docket No. 168057
• Decision Date: 02 February 1996
• Parties: , 109 Ed. Law Rep. 398 STATE TREASURER, Plaintiff-Appellee, v. Jon N. SCHUSTER and Jane C. Schuster, Defendants-Appellants.

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547 N.W.2d 332 215 Mich.App. 347, 109 Ed. Law Rep. 398 STATE TREASURER, Plaintiff-Appellee,
v.
Jon N. SCHUSTER and Jane C. Schuster, Defendants-Appellants. Docket No. 168057. Court of Appeals of Michigan. Submitted Dec. 6, 1995, at Detroit.
Decided Feb. 2, 1996, at 9:25 a.m.
Released for Publication April 29, 1996.

[215 Mich.App. 348]

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Frank J. Kelley, Attorney General, Thomas L. Casey, Solicitor General, E. David Brockman and Daniel M. Levy, Assistant Attorneys General, for plaintiff.

Dickinson, Wright, Moon, Van Dusen & Freeman by Lawrence G. Campbell, Detroit, for defendants.

Before MICHAEL J. KELLY, P.J., and REILLY and SOSNICK, ^* JJ.

MICHAEL J. KELLY, Presiding Judge.

Defendants Jon and Jane Schuster, husband and wife, appeal as of right from an order entered on August 11, 1993, by Ingham Circuit Judge Thomas Leo Brown granting in part plaintiff's motion for summary disposition and denying defendants' motion for reconsideration. Plaintiff brought this action under the State Correctional Facility Reimbursement Act (SCFRA), M.C.L. § 800.401 et seq.; M.S.A. § 28.1701 et seq., seeking reimbursement for the cost of defendant Jon Schuster's care while he is incarcerated in a state correctional facility. Plaintiff sought to obtain ninety percent of the proceeds from Jon Schuster's retirement allowance, which he is entitled to under the Public School Employees Retirement Act (PSERA), M.C.L. § 38.1301 et seq.; M.S.A. § 15.893(111) et seq.

On April 10, 1991, defendant Jon Schuster was [215 Mich.App. 349] sentenced to 2 1/2 to 15 years in prison. Plaintiff, State Treasurer, alleged that the state had expended approximately $22,000 for Schuster's care and that it would continue to expend comparable costs during his confinement. Schuster received a retirement allowance of more than $2,000 a month from the Michigan Public School Employees' Retirement System. Defendants each moved for summary disposition under MCR 2.116(C)(8), claiming plaintiff could not "collaterally attack" Jon Schuster's retirement allowance received under the PSERA, because such benefits were not subject to garnishment, attachment, or other process of law. Defendant wife claimed she was not subject to suit under the SCFRA because she was not a prisoner.

In an opinion and order dated April 23, 1993, the court denied both motions. The court held that Jon Schuster's PSERA retirement allowance could be considered in evaluating his ability to pay for the expense of his incarceration, even though he did not have other assets to support his family in lieu of that retirement allowance. Further, the court held that although the retirement allowance was not subject to direct attachment or garnishment, plaintiff could obtain the funds after Jon Schuster received payment. Considering Jane Schuster's situation as "an innocent party to her husband's conduct," the court found "no reason to subject her to any greater hardship ... than is necessary." Thus, the court concluded that plaintiff could obtain only fifty percent of the retirement proceeds. The court also decided that Jane Schuster was a proper party because she had direct control over the receipt and deposit of the allowance proceeds.

In an order entered on June 11, 1993, the court incorporated its April 23, 1993, opinion and order and required defendants to pay $1,000 a month of [215 Mich.App. 350] the retirement allowance to the court clerk beginning July 1, 1993. The court entered a final order on August 11, 1993, granting in part plaintiff's motion for summary disposition and denying defendants' motion for reconsideration. The order also modified and supplemented the June 11,

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1993, order and required that $1,000 be paid each month during the time Jon Schuster remained in prison and that the $25,666 arrearage be paid in $1,000 monthly installments after his release. Defendants appeal from this order. They contend that the court's holding violates the PSERA exemption and nonassignability clause.

This Court reviews de novo a trial court's grant of a motion for summary disposition brought under MCR 2.116(C)(8). Mieras v. DeBona, 204 Mich.App. 703, 706, 516 N.W.2d 154 (1994). The trial court erred in granting summary disposition in plaintiff's favor. The trial court should have granted summary disposition in defendants' favor, dismissing plaintiff's complaint for reimbursement under the SCFRA because the PSERA exemption and nonassignability clause is paramount.

In 1984, the Legislature amended various sections of 1935 P.A. 253, the Prison Reimbursement Act (PRA) and renamed it the State Correctional Facility Reimbursement Act (SCFRA). While the SCFRA retained the basic purpose of the PRA, it...