CONTRACTING AWAY CHILD SUPPORT ARREARAGES

February 6, 2012 § 1 Comment

If you’ve practiced family law to any appreciable degree, you will recognize this vignette:

Your client, Charlene, has had no success in getting Ron, her deadbeat ex, to pay any child support. The contempt actions you filed just don’t seem to accomplish much except continuance after continuance based on unfulfilled promises and begging, compounded with Charlene’s tender-hearted reluctance to see “the father of my children” jailed.

Just when you’re about at the end of your rope, a ray of hope breaks through the darkness. Charlene sweeps into your office, elated that she and Ron have worked out a deal. Charlene is willing to forget the $17,000 that Ron owes for back child support if Ron will buy Junior a used Toyota pickup (with 136,000 miles) and commence paying current support.

You hastily draft a joint petition and agreed judgment, get the parties to sign, and track down your friendly local chancellor. Sign on the dotted line, judge, you say, and make this problem go away.

What do you think the judge will do? Surely he will approve this, since the parties have agreed, and it will clear up an continuing, chronic course of contumely.

But the judge says no, citing Tanner v. Roland, 598 So.2d 783 (Miss. 1992), in which the parties struck a similar deal, which the Mississippi Supreme Court found to be invalid. Citing Calton v. Calton, 485 So.2d 309, 310-311 (Miss. 1986), the court pointed out that “The child’s right to his parent’s support can not be bargained or contracted away by his parents.” The Tanner court said at page 786, “We have consistently held that child support payments vest in the child as they accrue. Once they have become vested, just as they cannot be contracted away by the parents, they can not be modified or forgiven by the courts.”

Interestingly, Tanner also resulted in the supreme court finding that a five-year-old judgment of that same trial court eliminating an arrearage was void. You just can not do away with a vested arrearage.

Since the Tanner case, the Mississippi legislature created an exception for fathers whose parentage is disestablished. You can read about that statute here.

There is also the situation recognized in Varner v. Varner, in which the court may deem child support to have been “paid” to or for the benefit of the child when the child comes to live with the paying parent for a time by agreement of the parties. The theory is that it would create an unjust enrichment for the parent who did not have the child during that time. In such a case, the trial court still may not forgive the arrearage, but may only declare it to have been “paid” to for for the benefit of the child.

It is the Tanner-Calton line of cases that convinces me that it is improper for parents to contract away the right to future support at all in a property settlement agreement. I’m talking about language to the effect that neither party shall pay child support to the other, or that each party will support the child when the child is with him or her. Is that not bargaining or contracting away the child’s right to support as prescribed by Calton? I believe it is.

A contract to do away with child support is invalid and unenforceable. Even if you skate it past your chancellor, you will face reversal on appeal.

A MATTER OF INTEREST FOR CHILD SUPPORT CASES

February 7, 2011 § Leave a comment

MCA § 75-17-7 provides:

All judgments or decrees founded on any sale or contract shall bear interest at the same rate as the contract evidencing the debt on which the judgment or decree was rendered.  All other judgments or decrees shall bear interest at a per annum rate set by the judge hearing the complaint from a date determined by the judge to be fair but in no event prior to the filing of the complaint.

It is error for the trial court to fail to award interest on the amount adjudicated to be owed for arrearage in child support.  Ladner v. Logan, 857 So.2d 764 (Miss. 2003). 

Although the statute expressly states that pre-judgment interest may not extend back prior to the filing of the complaint, the rule does not apply to due and unpaid child support.  That is because each payment in arrears is vested when due and becomes an automatic judgment against the obligor.  Pope v. Pope, 803 So.2d 499, 501 (Miss. App. 2002).  Each unpaid monthly installment begins to accrue interest at the legal rate, not from the time it may subsequently be reduced to judgment by a court, and it is error for a chancellor to reduce or eliminate the interest.  Dorr v. Dorr, 797 So.2d 1008, 1015 (Miss. App. 2001).  Amounts paid by an obligor in arrears are applied first to the interest obligations, and then to extinguish the principal amount of the oldest outstanding child support payment, and then the next oldest, and so on.  Brand v. Brand, 482 So.2d 236, 238 (Miss. 1986). 

The appellate courts have allowed the trial judges deference in setting the rate of interest.  Rates from three pecrent (Brawdy v. Howell, 841 So.2d 1175, 1180 (Miss. App. 2003)) to eight percent (e.g., Houck v. Ousterhout, 861 So.2d 1000, 1003 (Miss. 2003)) have been upheld.

There is no prohibition that I know of for a property settlement agreement to provide a contract rate for interest on unpaid child support or other obligations such as alimony, but I have never seen a property settlement agreement with such a provision.  The rarity is due, I am sure, to the difficulty of getting an agreement.  An advantage would be that the court would be bound to the contract rate.  See, e.g., Tower Loans, Inc. of Mississippi v. Jones, 749 So.2d 189, 190 (Miss. App. 1999), where the court of appeals reversed a circuit judge’s imposition of eight percent interest where the contract called for a 34.71% rate, and the contract rate was not usurious.  Another advantage would apply to alimony and other non-child-support obligations in that it would allow pre-judgment interest back to the filing of the complaint for enforecement; a nice perk if you can get it.  Finally, setting an interest rate at least for non-child-support obligations might be prudent in view of the authority that, if the court does not impose interest on a judgment it renders for non-child-support obligations, it is presumed that the judgment does not earn interest.  Aldridge, August 28, 1998, A.G. Opinion #98-0507.

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