Opinion
Supreme Court No. S-10476.
December 16, 2005.
Appeal from the Superior Court of the State of Alaska, Third Judicial District, Anchorage, John Reese, Judge, Superior Court No. 3AN-99-3479 CI.
Lloyd C. Allen, n/k/a Ibraahiym Kadessh, pro se, Anchorage. Diane L. Wendlandt, Assistant Attorney General, Anchorage, and Gregg D. Renkes, Attorney General, Juneau, for Appellee.
Before: Bryner, Chief Justice, Matthews, Eastaugh, Fabe, and Carpeneti, Justices.
MEMORANDUM OPINION AND JUDGMENT
Entered pursuant to Appellate Rule 214.
I. INTRODUCTION
Lloyd Allen and the Child Support Enforcement Division have been disputing Allen's child support obligation for nearly ten years. This is the third time that the dispute has reached this court. The main issues presented are whether the division erred in deciding Allen's petition to modify his child support, whether it violated his rights by reporting his delinquent arrears to credit-reporting bureaus, and whether various delays in handling Allen's case violated his right to due process. We affirm the division's decision on Allen's petition for modification; we hold that the division properly calculated and reported Allen's delinquent arrears; and despite finding several instances of regrettable delay, we conclude that no violation of Allen's right to due process occurred.
Allen has changed his name to Ibraahiym Kadessh. To maintain consistency with earlier proceedings, we refer to him as Allen throughout this opinion.
II. FACTS AND PROCEEDINGS
A. Judge Card's 1995 Child Support Order
Lloyd Allen and Rosabelle Richardson (formerly Smith) are the parents of Jordan Smith, who was born in 1986. In 1988 the superior court awarded custody of Jordan to Richardson and ordered Allen to pay monthly child support. In 1991 Allen's support payments were set at $279 per month.
In August 1994 the Child Support Enforcement Division (the division) moved to modify Allen's 1991 support order. The court system misplaced the division's motion for several months; as a result, the superior court did not rule on it until June 1995, ten months after the motion was filed. In ruling on the motion, Superior Court Judge Larry A. Card increased Allen's support to $487 per month. Under Civil Rule 90.3(h)(2), the increase took effect retroactively beginning the first month after the division filed its motion for modification — September 1994. This was ten months before Judge Card issued his order, so the order resulted in Allen already owing $2,507.20 in back support on the date it was issued.
Since the court system itself had caused the delay that created these instant arrears, Judge Card tried to soften the blow by allowing Allen to repay this debt in monthly installments. The June 1995 order provided: "Due to the lateness of getting this file to the assigned judge, Mr. Allen is immediately placed in arrears. In the absence of any agreement, Mr. Allen shall not pay more than an additional $100 per month until he is current."
Allen appealed Judge Card's order. In October 1997 we issued an unpublished opinion, Allen v. Smith (Allen I), affirming the modification order.
Mem. Op. J. No. 0864 (Alaska, October 8, 1997).
B. The Division's Denial of Allen's 1997 Petition To Reduce His Child Support Obligation
That same month, October 1997, Allen quit his job at the Department of Veterans Affairs because he was being treated for a serious illness. In return for his resignation, the Department of Veterans Affairs had agreed to give Allen a buy-out payment of $12,824. Allen accepted the buy-out because he was concerned that the stress of his job would impede his recovery.
Soon after quitting his job, Allen asked the division to reduce his child support because he no longer earned any wages. The division denied Allen's request, so Allen appealed to the superior court. After the superior court rejected his appeal as untimely, Allen appealed to this court. In December 2000 we issued an opinion, Allen v. State, Department of Revenue, Child Support Enforcement Division ( Allen II), reversing the superior court's dismissal and directing that court to accept and decide Allen's appeal.
15 P.3d 743, 748-49 (Alaska 2000).
C. The Division's Decision To Report Allen for Delinquent Arrears
Meanwhile, a second dispute had been brewing over the division's handling of the back support obligation created by Judge Card's 1995 order. As already mentioned, Judge Card's order required Allen to pay back this debt at the rate of no more than $100 per month. In addition, Judge Card's order required Allen to make ongoing child support payments of $487 per month. After Judge Card issued the June 1995 order, the division began withholding money from Allen's paycheck. But it only managed to collect about $219 in monthly wages. Allen made no additional payments. Since these collections failed to cover Allen's current monthly obligation of $487, the division did not credit him with any payment toward the $100 per month he owed on the arrears created by Judge Card's 1995 order.
As of October 1997, the division calculated that Allen owed total arrears of over $10,000. This included the "instant arrears" of $2,507 created by Judge Card's June 1995 order; arrears representing the portions of Allen's ongoing support obligation that remained unpaid since the 1995 order; and accrued interest.
The 1995 order required these arrears to be repaid at the rate of $100 per month beginning in July 1995, so by October 1997 — twenty-seven months later — the division counted the full amount of these arrears as being past due.
In July 1999 the division notified Allen that it intended to report him to a consumer credit bureau for having delinquent arrears, as required by Alaska law and the division's regulations. Allen objected and asked the division to review its decision. The division concluded that its records were correct, so it informed Allen that it would proceed to report his delinquent arrears.
See AS 25.27.273; 15 Alaska Administrative Code (AAC) 125.418 (2003).
Allen appealed to the superior court, challenging the division's reporting decision; in November 1999 the superior court stayed that appeal until this court decided Allen's then-pending appeal from the superior court's order rejecting his earlier appeal challenging the division's denial of his 1997 motion to reduce his child support obligation.
D. Joinder of Modification and Credit Reporting Appeals
Allen's superior court appeal on the reporting decision thus remained pending in December 2000, when our decision in Allen II remanded his earlier appeal on the issue of modification. Soon after Allen II remanded that issue, Allen moved to join his two superior court appeals. The superior court granted his motion and joined the two cases. The parties and the court then agreed to treat Allen's appeal of the division's 1997 modification decision as if Allen had filed a new motion for modification of child support directly with the superior court.
E. Superior Court's Ruling on the Modification Issue
After holding an evidentiary hearing on this issue, Superior Court Judge John Reese issued a decision that partly granted and partly denied Allen's 1997 motion to modify his child support obligation. While finding that Allen had acted reasonably in resigning his job, the court ruled that his loss of the job did not necessarily reduce his child support obligation. Noting that Allen "had other resources to support himself and his family [during the year after his resignation]," the court evaluated those resources and concluded that they enabled him to continue paying his child support obligation through October 1998 — a year after his resignation.
But by November 1998, the superior court found, Allen's financial circumstances had changed. Relying on child support guidelines affidavits submitted by Allen and Allen's attorney, the court calculated that his monthly support payments should be reduced to $367.71 from November 1998 through 1999, and to $412.46 from January 2000 until October 2000.
Allen received custody of Jordan in October 2000, so his child support obligation then ceased.
F. Superior Court's Ruling on the Credit-Reporting Issue and Other Remaining Questions
Despite the prior order consolidating Allen's two pending cases — his appeal of the division's 1997 modification decision and his appeal of its 1999 credit-reporting decision — Judge Reese did not initially address the credit-reporting issue, deciding only the questions raised by Allen's motion to modify his support in light of his 1997 resignation from work. Allen then appealed Judge Reese's decision on the modification issue. But the parties soon recognized that the credit-reporting issue remained undecided, so they stipulated to a temporary stay of the newly filed supreme court appeal, with a remand to allow the superior court to resolve the remaining issues.
Under the stipulation the parties agreed that the superior court should decide two issues on remand: (a) whether the division misconstrued Judge Card's June 1995 order placing a $100 limit on the monthly amount the division could collect from Allen; and (b) whether the division's subsequent credit-reporting decision (which relied on its interpretation of the June 1995 order) violated Allen's right to due process. In addition, the stipulation noted that Allen would ask the superior court to resolve three further points — points that the state had not agreed should be addressed: (a) whether Judge Reese had erred by finding, as part of his modification decision, "that both [Allen] and [the division] failed to communicate between 1997 and October 2001"; (b) whether AS 25.27.194, which requires the division to "use its best efforts" to ensure equal processing times, on average, for requests seeking upward and downward modifications of child support, is unconstitutionally vague; and (c) whether Allen could properly request monetary damages for the division's alleged violations of his constitutional rights — and, if so, whether he was entitled to damages.
In addressing the credit-reporting issues the superior court found it unnecessary to squarely decide whether the division had misconstrued Judge Card's June 1995 order or violated Allen's right to due process; while noting that Allen's name should not have been reported if he had complied with Judge Card's order, the court found that Allen was not entitled to maintain a claim for damages from the division in any event, because the state could not be sued under 42 U.S.C. § 1983 and was entitled to claim sovereign immunity under Alaska law.
The court further ruled that AS 25.27.194 was not unconstitutionally vague; that the division's delay in deciding Allen's petition to modify his child support obligation had not violated his due process rights; and that, despite its earlier finding to the contrary, Allen and the division did communicate with each other between 1997 and October 2001, although, in the court's view, the division rarely responded to the issues that Allen wanted addressed.
After the superior court decided the stipulated issues on remand, Allen renewed this appeal.
III. DISCUSSION
On appeal Allen challenges the superior court's ruling on his motion to modify his child support obligation and its ruling on his appeal of the division's decision to report his delinquent arrears to a credit bureau. Allen also raises several related constitutional and procedural points.
A. Allen's Motion To Modify His Support
As previously stated, Allen sought to reduce his support obligation as of October 1997, arguing that he had resigned his job at the Department of Veterans Affairs and no longer earned any wages. The superior court declined to reduce Allen's payments for the twelve months immediately following his resignation, finding that, although he acted reasonably in resigning his job, he had other financial resources that enabled him to continue his child support payments. The court did reduce Allen's child support payments as of November 1998, but this reduction was not as large as Allen requested. Allen now argues that the superior court erred in refusing to reduce his payments during the first year following his resignation and in determining the amount of his reduced obligation after that. Neither argument has merit.
Alaska Civil Rule 90.3 allows courts to modify child support orders in light of material changes in the non-custodial parent's financial circumstances; the rule deems changed circumstances to be material if they would alter the parent's child support obligation by more than fifteen percent. But when changed circumstances result from voluntary and unreasonable unemployment, Rule 90.3 allows the court to "calculate child support based on a determination of the [parent's] potential INCOME."
Civil Rule 90.3(a)(4).
Here, in challenging the superior court's decision not to reduce his child support obligation for the first twelve months after he resigned his job, Allen assumes that the trial court imputed income to him under these provisions. He insists that the court erred in doing so because he was not voluntarily and unreasonably unemployed.
But the superior court did not impute income to Allen. Instead, it looked to his existing assets to determine whether the income Allen lost upon resigning his job actually changed his financial circumstances sufficiently to justify reducing his child support obligation. This was permissible under Rule 90.3 regardless of whether Allen's resignation was voluntary and reasonable.
Here, Allen experienced a large reduction in earnings upon resigning his job. But as the superior court accurately noted, Allen's resignation left him with a number of liquid assets to rely on during the ensuing year. The court properly looked to those resources in calculating Allen's ability to maintain his ongoing support obligation. Specifically, the record indicates that during the period at issue here, October 19970-ctober 1998, Allen received income totaling about $40,000: (a) the $12,824 buy-out that he received from the Department of Veterans Affairs; (b) over $16,000 in funds from his thrift savings plan; (c) his 1998 permanent fund dividend of $1,541; (d) unemployment compensation of $5,684; and (e) wages of $3,325. Allen's 1998 Child Support Guidelines Affidavit indicates that he claimed adjustments to income under Civil Rule 90.3(a) totaling $3,360.64. Thus, for child support purposes, his adjusted income between October 1997 and October 1998 appears to have amounted to nearly $37,000.
Wages deposited in a thrift savings plan are ordinarily taxed upon withdrawal. See The Thrift Savings Plan, at http://www.tsp.gov/features/chapter01.html (last visited Oct. 12, 2005). Here, Allen's 1998 income tax return indicates that he declared his withdrawals from his savings plan as income.
There is also evidence that Allen was receiving veterans disability payments of $340 per month ($4,080 annually).
Under Rule 90.3, this net income would result in a monthly child support obligation of more than $600 — an amount easily exceeding the $487 monthly payment that Allen's already existing support order required him to pay. Thus, the superior court did not err in refusing to reduce Allen's payments during the year after his resignation.
Although the superior court did reduce Allen's payments as of November 1999, Allen objects that the court improperly calculated the reduced amount by relying on outdated information. But the record indicates that the court properly based its calculations on two sets of child support affidavits — one that was signed by Allen and formally filed, and an unsigned set informally submitted by Allen's attorney. These two sets of affidavits differ only in that the unsigned version included additional income consisting of disability payments that Allen received from the Department of Veterans Affairs. At the evidentiary hearing on his motion for modification, Allen admitted that he was receiving disability payments of approximately the same amount listed in the unsigned affidavits. And on appeal Allen does not argue that the superior court erred in considering both his signed and his unsigned affidavits. Under Civil Rule 90.3, disability payments are considered as income for purposes of calculating child support. Considering this income in addition to the income listed on Allen's signed affidavits, it appears that the superior court accurately calculated Allen's reduced support obligation after October 1999.
Osmar v. Mahan, 53 P.3d 149, 151 (Alaska 2002).
B. The Division's Credit-Reporting Decision
Allen separately challenges the superior court's ruling on his appeal from the division's decision to report his delinquent arrears. Federal law requires state child support agencies to report delinquent arrears to a credit-reporting bureau or institution. The Alaska Statutes and the division's regulations mirror this federal requirement. Specifically, 15 AAC 125.418(a) provides:
42 U.S.C. § 666(a)(7) (2003), 42 U.S.C. § 654(20)(A) (2003).
See AS 25.27.273; 15 AAC 125.418.
If an obligor owes arrears of more than $1,000, the agency will report the name of the obligor and the amount of arrears owed by that obligor to a credit bureau or lending institution. The agency will make the report to a credit bureau or lending institution on a monthly basis.
In this case, as previously indicated, the division told Allen in 1997 that it intended to report his delinquent arrears. By then, the division's records showed Allen as owing more than $12,000 in back child support payments. Allen appealed to the superior court, disputing the division's decision and asking for damages on the ground that the decision violated his constitutional rights. The superior court rejected Allen's claims, concluding as a matter of law that Allen would not be entitled to recover damages against the state even if the division had improperly reported him for having delinquent arrears.
Allen now disputes the superior court's ruling on various grounds. But he bases his arguments on an incorrect reading of Judge Card's June 1995 child support order. Judge Card's June 1995 order set Allen's monthly child support obligation at $487 and applied the new obligation retroactively as of September 1994. Although the provision requiring retroactive payment created instant arrears exceeding $2,000, Judge Card tempered the impact of creating the debt by directing that "Mr. Allen shall not pay more than an additional $100 per month until he is current."
On appeal, Allen construes this additional $100 maximum monthly payment requirement as covering his entire child support obligation, past and future — not just the instant arrears created by Judge Card's June 1995 order. On this basis, Allen insists that the division grossly erred in reporting him for having delinquent arrears:
If Judge Card's order had been properly implemented, no "unpaid" or unattended arrearage would ever have existed. Credit reporting would not have been necessary because Allen remained in complete compliance with his child support obligation well beyond the time he requested a modification because of decreased income.
But Allen's proposed reading of Judge Card's order is unreasonable. In requiring Allen to repay no more than "anadditional $100 per month until he is current," (emphasis added) the order obviously addressed only the instant arrears that the order created, thus requiring Allen to pay no more than $100 per month toward his arrears in addition to making the $487 monthly payments that the order required him to pay on an ongoing basis.
Since the record establishes that the division based its calculation of Allen's arrears on a correct interpretation of Judge Card's 1995 order, its decision to report Allen for having delinquent arrears was both factually and legally sound. We therefore find no merit in Allen's challenge to the division's reporting decision or in his claim for damages caused by reporting.
C. Additional Issues
Allen also raises a number of issues arising from the manner in which the court system and the division have handled his case. He asserts that his due process rights have been violated by (1) the superior court's failure to decide his credit-reporting issue at the same time that it decided his modification issue; (2) the division's delay in addressing his petition to reduce his child support; and (3) the superior court's decision to schedule an evidentiary hearing without first reviewing his briefing.
In addressing these due process claims, we apply a balancing test to determine whether the state's actions "violated the due process right to be heard at a meaningful time." Under this test, we must consider the length of delay, the state's justifications, whether Allen's conduct contributed to the delay, and whether there was any resulting prejudice.
United States v. $8,850 In United States Currency, 461 U.S. 555, 564 (1983). See also Whitesides v. State, Dep't of Pub. Safety, Div. of Motor Vehicles, 20 P.3d 1130, 1134 n. 4 (Alaska 2001) (suggesting in dicta that the important factor in determining whether a delay is unreasonable is whether there has been a pre-hearing deprivation of property).
$8,850, 461 U.S. at 564.
Id.
Id. at 568-69.
Id. at 569.
Here, there can be no question that the division's and the court system's handling of Allen's case was far from exemplary and regrettably caused several appreciable delays. We nevertheless fail to see any circumstances that rise to the level of a due process violation. We find no indication that Allen's ability to present evidence was significantly impaired by the division's or the court system's actions; nor do we find any other material prejudice. Moreover, as the state correctly points out, Allen might have avoided much of the hardship caused by the delay in reviewing the division's decision to report his delinquent arrears by asking the superior court for a stay pending appeal. Considering the totality of these circumstances, although Allen's frustration with the system is certainly understandable, we find no violation of due process.
Allen further challenges two of the superior court's factual findings. He contends that the court erred in finding that it was reasonable for him to quit his job, and he objects to the court's finding that there was a lack of communication between the parties.
These contentions are meritless. As the state notes, the first of these findings was favorable to Allen, so it provides no ground for complaint. As for the second finding, which noted a lack of communication between the parties, the superior court ultimately corrected it by stating in its post-stipulation findings that "there is no question Mr. Allen communicated with CSED. CSED also communicated with Mr. Allen, but almost always without reference to the issues he had presented to them." In any event, since neither of these factual findings has any bearing on the outcome of Allen's legal claims, his arguments appear to be moot.
Allen additionally complains that Judge Reese was biased against him. He bases this contention on the fact that Judge Reese scheduled an evidentiary hearing without first reading the briefs and on the judge's supposedly "prejudicial view of Judge Card's ruling." But Allen did not seek Judge Reese's disqualification below. Moreover, to prove a claim of bias, Allen would need to show that the judge formed an opinion of him based on extrajudicial sources. Allen has failed to do so.
See, e.g., Peterson v. Ek, 93 P.3d 458, 467 (Alaska 2004).
If a judge merely derives an opinion based on the record, and the opinion is supported by the record, no bias is shown. Here, Judge Reese's decision to schedule an evidentiary hearing hardly reveals a bias against Allen, since Allen expressly requested a hearing. And we similarly find no trace of bias in Judge Reese's interpretation of Judge Card's 1995 order. Indeed, if anything, Judge Reese's interpretation seems charitable to Allen. Allen's claim of bias is thus meritless.
Id.
Last, Allen challenges the superior court's ruling rejecting his claim that AS 25.27.194 is unconstitutional. Alaska Statute 25.27.194 requires the division to
use its best efforts to process modifications of support orders under AS 25.27.190 and 25.27.193 in a manner that will result in the same average processing time for modifications that increase obligors' responsibilities as for modifications that decrease obligors' responsibilities.
Allen insists that this statute is unduly vague because it "fails to provide the guarantee of timely and consistent processing." But Allen cites no authority for the proposition that a law becomes unconstitutionally vague merely because it requires the government to "use its best efforts" instead of insisting on perfect compliance. Nor are we aware of any authority to support such a stringent demand. As the state observes, "there is no legal requirement that the legislature establish deadlines for administrative actions." To the contrary, whether an agency's actions violate due process seems like a matter best left to a case-by-case determination. We thus affirm the superior court's decision that AS 25.27.194 is not unconstitutionally vague as applied to Allen's case.
See, e.g., In the Disciplinary Matter of Triem, 929 P.2d 634, 641 (Alaska 1996) (rejecting a due process challenge based on delay in deciding a disciplinary matter where the decision was issued within the statutory time for filing a complaint, the challenging party contributed to the delay, and no prejudice was shown); North Slope Borough v. Barraza, 906 P.2d 1377, 1381 (Alaska 1995) (holding that a four-month delay in issuing detailed findings was not so unreasonable as to create a due process violation).
IV. CONCLUSION
For these reasons, we AFFIRM the superior court's judgment.