Opinions, June 24, 2016: Informal Child Support Payments

The Texas Supreme Court issued its ruling in Ochsner v. Ochsner, No. 14-0638, a 7-2 opinion with one concurrence and two dissents. At issue was the statutory interpretation of the child support enforcement statute, Tex. Fam. Code §157.263, which the court held permits a trial court presiding over an enforcement action to consider payments that do not comply with the underlying order when determining the arrearages (if any).

Victoria and Preston divorced in December 2001. The trial court entered a decree which ordered Preston to pay Victoria $240 twice a month and $563 directly to Enron’s Kid’s Center for the daughter’s preschool. If the daughter stopped attending EKC, Preston was to pay Victoria $400 twice a month through the Harris County Child Support Office, noting that failure to comply with the time, place, and manner of the payments may result in Preston not receiving credit for the payment.

The child stopped attending EKC and Preston made payments directly to various private schools rather than to Victoria through the registry. Preston paid almost $80,000 in total, more than $20,000 over the amount required under the order.

Almost a decade after the child stopped attending EKC, Victoria filed an enforcement action against Preston, arguing he was in arrears and seeking a money judgment for the balance, interest, fees and costs. The trial court found for Preston, finding he had discharged his child support obligation, in part because the order did not include decretal language requiring him to pay child support after the daughter stopped attending EKC.

The Fourteenth District Court of Appeals reversed, holding that the decree did order Preston to continue to make payments after the child left EKC. On remand, the trial court, presided over by the same judge who rendered the decree, again found Preston was not in arrears. A divided court of appeal reversed, holding the trial court impermissably enforced a private agreement to modify a child support order. The court of appeals also held that the trial court was barred from considering Preston’s direct tuition payments when confirming the amount of arrearages. Preston appealed.

The majority’s opinion focuses on the statutory language of section 157.263:

(a) If a motion for enforcement of child support requests a money judgment for arrearages, the court shall confirm the amount of arrearages and render one cumulative money judgment.
(b) A cumulative money judgment includes:
(1) unpaid child support not previously confirmed;
(2) the balance owed on previously confirmed arrearages or lump sum or retroactive support judgments;
(3) interest on the arrearages; and
(4) a statement that it is a cumulative judgment.

Regarding the statute as a whole, the majority found that “the structure of the enforcement statute confirms the view that a trial court may consider direct payments that discharge the obligee’s own obligation to provide the funds.” The manner of payment specified by the order does not hamstring the enforcement court in determining the amount of arrearages because, according to the majority, “the statute contemplates that the trial court has discretion to consider direct payments either to the other parent or to a third party in deciding whether an arrearage exists.”

The majority distinguished this case from cases where the parties privately agreed to reduce or abate child support payments outside the order (not the case here, as the amount paid was in excess of what was ordered). The opinion also distinguished Office of the Attorney General of Texas v. Scholer, which held that an obligor may not allege estoppel as an affirmative defense in a child support enforcement action.*

In other words, trial courts may consider indirect payments for the benefit of the child when they assess arrearages. In its conclusion, the opinion warned it should not be construed to mean tuition payments always qualify as child support or to encourage parents to make direct payments to bypass the disbursement unit. On the contrary, the majority stated that, under the right facts, the trial court might not abuse its discretion by refusing to consider such payments. The Supreme Court reversed the court of appeals and rendered judgment for Preston.

It will be interesting to see what effects this opinion has on the case law. The opinion states repeatedly that one of the things that distinguishes this from other cases is that the tuition payments were in excess of the court-ordered child support. But the practical effect of this may raise questions for a family law practitioner. For example, while tuition for private school education is clearly a benefit for the child, would payments made for other expenses count as credit against arrearages? If the parent deposited money into an UGMA in lieu of making child support payments, would that suffice? The holding indicates such questions will be in the trial court’s discretion.

Another important question: What will be considered an adequate substitute for a child support payment? In this case, it was tuition payments. But what else might pass muster? If a parent fails to pay child support, but transfers stock to the nonpaying parent, would that suffice?

Justice Guzman, former Houston family law judge, filed a concurrence (joined by Justice Lehrmann) which stated “[T]his case is not about excusing nonpayment or crediting an overpayment, both of which implicate a modification of the amount of child-support arrearages.” Rather, the case is about the trial court’s authority under section 157.162(c)(1) to count support payments not made through the registry. Additionally, Justice Guzman stressed that obligors who ignore the dictates of the order do so at their own peril but, as a practical matter, parents may agree to accept direct payments instead of registry-only payments.

Justice Johnson’s dissent (joined by Justice Boyd) focused on the language of the decree and Preston’s dereliction therefrom, but the majority opinion criticized Judge Johnson’s dissent for focusing too closely on the decree’s language to the exclusion of controlling statutory provisions.

Justice Boyd’s dissent (joined by Justice Johnson) expressed concern that ruling in favor of either party could produce an inequitable result. Preston testified that he and Victoria agreed he could pay the child’s private school tuition in lieu of support. Forcing him to pay a decade of back child support would be onerous and unfair. But Victoria claimed that was not the agreement; it was  Preston who wanted the child to attend private school and she agreed, provided he paid for it–but not that private school tuition was in lieu of child support. If Victoria’s version of the facts are true, she was denied years of child support. Regardless of which parent was correct, Justice Boyd cautioned the order must be followed as written or it would invite either trial courts to impermissibly modify the order or parents to overthrow the court order.

 

*Scholer also–inadvertently–stands for the proposition that the prettier brief is not always the winning brief.

 

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