in the Interest of C.E.S., Minor Child ( 2011 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-10-00159-CV
IN THE INTEREST OF C.E.S.,
MINOR CHILD
----------
FROM THE 97TH DISTRICT COURT OF CLAY COUNTY
----------
OPINION
----------
I. INTRODUCTION
The sole issue that we address in this appeal is whether the defense of
estoppel is available in a suit to enforce unpaid child support brought by the
Office of the Attorney General (OAG) in its capacity as an assignee. Because we
hold that estoppel is available as a defense in an enforcement action brought by
the OAG as an assignee of a parent obligee, we will reverse and remand.
II. FACTUAL AND PROCEDURAL BACKGROUND
In 1993, Appellant Richard Lynn Scholer, Jr. fathered a son, C.E.S., with
Denise Louise Scholer. Denise divorced Richard in 1994 in California. In the
divorce decree, the trial court ordered Richard to pay $450 per month in child
support ―until further order of the court, the child dies, marries, is emancipated,
reaches the age of 19, or the age of 18 and is not a full time high school student
residing with a parent, whichever occurs first.‖
Richard made payments of $450 a month for several months and then
began paying $300 a month upon the oral agreement of Denise. Richard made
payments through 1999.
In a letter to Denise dated July 12, 2000, Richard explained his frustration
at being continually denied the opportunity to speak to C.E.S. and to visit with
him. Richard asked Denise to confirm whether she wanted him to be C.E.S.’s
father and whether she no longer needed his child support payments.
Approximately two weeks later, Richard received a letter from Denise’s attorney,
Michael Curtis, asking whether Richard would be agreeable to signing an
affidavit to terminate his parental rights to C.E.S. The letter stated, ―As you are
aware, a termination of your rights would also terminate any support obligation
which you may have in the future.‖
Two months later, Curtis sent another letter to Richard, enclosing a revised
―Father’s Affidavit for Voluntary Relinquishment of Parental Rights‖ and asking
2
Richard to sign it in front of two witnesses and a notary and return it to Curtis.
The affidavit stated, among other things,
I am presently obligated by court order to make payments for
the support of the child.
....
. . . I have been informed that my parental rights, powers,
duties, and privileges are as follows:
....
3. the duty to support the child, including providing the
child with clothing, food, shelter, medical and dental care, and
education;
....
I freely and voluntarily give and relinquish to Denise Louise
Wilbourn all my parental rights and duties.
I fully understand that a lawsuit will be promptly filed in a court
of competent jurisdiction to terminate forever the parent-child
relationship between me and the child named above. . . .
I know that I have the right to appear personally before the
Court, with an attorney of my choice, to testify about my desires with
respect to my child. However, I do not want to go to court in person
and choose not to be represented by a lawyer. I want this Affidavit
for Voluntary Relinquishment of Parental Rights presented to the
Court.
Because I do not want to testify in person before the Court, I
freely and voluntarily waive and give up my right to the issuance,
service, and return of citation, notice, and all other process in any
suit to terminate my parental rights or in any suit to terminate my
parental rights joined with a suit to adopt. I do not want to be
informed further about the lawsuit. I specifically agree that a final
hearing in the lawsuit may be held at any time without further notice
to me. . . .
3
....
I FULLY UNDERSTAND THAT I MAY NOT BE FURTHER
INFORMED ABOUT THE TERMINATION SUIT OR ABOUT ANY
OTHER HEARINGS OR PROCEEDINGS AFFECTING THE CHILD
NAMED IN THIS AFFIDAVIT.
Richard signed and returned the affidavit to Curtis and did not hear further
from him or Denise.1 Richard assumed that his parental rights were terminated
and discontinued making child support payments.
Nine years later, in September 2009, the OAG filed a ―Notice Of
Registration Of Foreign Support Order (UIFSA)‖ in the 97th District Court of Clay
County. The OAG also filed a ―Motion For Enforcement And Suit For
Modification Of Support Order,‖ requesting that the trial court confirm an
arrearage from May 1994 through 2009. Richard answered with a general denial
and pleaded several defenses, including the affirmative defense of estoppel.
The trial court held a hearing on the OAG’s motion to enforce and heard
testimony from Denise and Richard. Denise testified that she never followed
through with the termination, that she knew that the termination did not ―go
through,‖ and that she did not feel that she had a duty to notify Richard. She also
testified that she and Curtis had parted ways after he sent the letter in 2000,2 that
she had never tried to contact him, that she was not notified that Richard had
1
Neither Richard’s attorney nor the attorney for the OAG contacted Curtis
to see if he had received Richard’s affidavit.
2
Denise testified that Curtis ―was in trouble for methamphetamines.‖
4
signed the affidavit, and that she did not see Richard’s affidavit of relinquishment
until December 2009. She denied that a conspiracy existed to have Richard
―rack up a bunch of child support arrearages‖ while being denied involvement in
his son’s life.
Richard testified that he had paid $11,725 in child support before he
signed the affidavit but that his bank did not have records dating back to 1994 to
prove all of his payments. After signing the affidavit of relinquishment, he did not
expect to hear back because of the ―no further notice‖ provision. He had no
further contact with Denise or C.E.S. after September 2000. He had no
knowledge that his parental rights had not been terminated until 2009 when he
received a notice that child support would be deducted from his paycheck.
After hearing the testimony, the trial court signed an order confirming that
Richard was in arrears in the amount of $77,875 as of March 26, 2010. The trial
court made findings of fact and conclusions of law, including a conclusion of law
that Richard’s defense of estoppel was not available. Richard now appeals from
the trial court’s order modifying his child support payments and confirming a
$77,875 arrearage.
III. DEFENSE OF ESTOPPEL IS AVAILABLE
In his sole point, Richard argues that the trial court erred by ruling that as a
matter of law the defense of estoppel is not available in a child support
enforcement suit brought by the OAG. We review a trial court’s conclusion of law
5
de novo. BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex.
2002).
The OAG is Texas’s Title IV-D agency. Tex. Fam. Code Ann. § 231.001
(Vernon 2008). As Texas’s Title IV-D agency, the OAG may file suit for
modification of child support or a motion for enforcement of child support. Id.
§ 102.007 (Vernon 2008), § 231.105(a) (Vernon Supp. 2010). The OAG sues to
enforce child support based on an actual or an implied assignment from the
parent owed support, the obligee. Id. §§ 231.102, .104, .106, .107 (Vernon
2008); In re T.L.K., 90 S.W.3d 833, 839–40 (Tex. App.—San Antonio 2002, no
pet.) (explaining that ―[t]he OAG generally enforces child support under an
assignment of the support rights‖); In re A.M.E., 71 S.W.3d 401, 402–03 (Tex.
App.––San Antonio 2001, no pet.) (same); see also Office of Attorney Gen. v.
Crawford, 322 S.W.3d 858, 860–62 (Tex. App.—Houston [1st Dist.] 2010, pet.
filed) (holding OAG lacked standing to file suit to modify existing child support
order to provide support for adult disabled children absent assignment of support
rights). Child support payments assigned for collection to the OAG must be
made payable to the OAG. Tex. Fam. Code Ann. § 231.105(a); A.M.E., 71
S.W.3d at 403.
Any parent obligee under a support order may refuse Title IV-D
enforcement services unless required to accept such services pursuant to other
law. See Tex. Fam. Code Ann. § 231.0011(c) (Vernon 2008). A parent obligee
is required to accept such services upon approval of an application for or the
6
receipt of financial assistance as provided by chapter 31 of the Human
Resources Code; approval of an application or receipt of financial assistance
constitutes an assignment to the Title IV-D agency of any rights to support from
any other person that the applicant or recipient may have personally or for a child
for whom the applicant or recipient is claiming assistance. Tex. Fam. Code Ann.
§ 231.104(a).
Because the OAG as Texas’s Title IV-D agency brings suit to collect child
support pursuant to either an actual or implied assignment of the child support
order’s obligee, the OAG steps into the shoes of the assignor/obligee and takes
the assigned rights subject to all defenses the opposing party might be able to
assert against the assignor/obligee. Burns v. Bishop, 48 S.W.3d 459, 466 (Tex.
App.––Houston [14th Dist.] 2001, no pet.) (stating that ―it is axiomatic that an
assignee or subrogee walks in the shoes of his assignor and takes the assigned
rights subject to all defenses which the opposing party might be able to assert
against his assignor‖); Trueheart v. Braselton, 875 S.W.2d 412, 415 (Tex. App.––
Corpus Christi 1994, no writ); Irrigation Ass’n v. First Nat’l Bank of Frisco, 773
S.W.2d 346, 348 (Tex. App.—Dallas 1989, writ denied); Vogt v. Jones, 396
S.W.2d 539, 540 (Tex. Civ. App.––Fort Worth 1965, no writ). In a private child
support enforcement suit brought by an obligee parent against an obligor parent,
the defense of estoppel is available. See Kawazoe v. Davila, 849 S.W.2d 906,
908–09 (Tex. App.––San Antonio 1993, no writ) (holding ―estoppel is available as
a defense and was properly proved in this case [an action to enforce child
7
support]‖); LaRue v. LaRue, 832 S.W.2d 387, 392–93 (Tex. App.––Tyler 1992,
no writ) (holding that ―the trial court’s third conclusion of law pertaining to the
unavailability of the estoppel defense in the instant [child support enforcement]
case was erroneous‖); see also Hall v. Hall, No. 09-06-00206-CV, 2007 WL
2127133, at *3 (Tex. App.—Beaumont July 26, 2007, no pet.) (mem. op.)
(holding that appellant’s conduct supported application of the equitable doctrine
of estoppel in suit between mother and father involving alleged child support
arrearage). Thus, because the defense of estoppel is available to an obligor in a
suit for child support enforcement brought by the obligee, we hold that the OAG,
as the assignee of the obligee, is likewise subject to the defense of estoppel.
The OAG in this appeal argues that in prosecuting a child support
enforcement suit as Texas’s Title IV-D agency, it is a state agency performing a
state function and, consequently, cannot be subject to the defense of estoppel.
The OAG points to family code section 231.109. Tex. Fam. Code Ann.
§ 231.109(d) (Vernon 2008). That section is titled ―Attorneys Representing
State‖ and provides in pertinent part,
(d) An attorney employed to provide Title IV-D services
represents the interest of the state and not the interest of any other
party. The provision of services by an attorney under this chapter
does not create an attorney-client relationship between the attorney
and any other party. The agency shall, at the time an application for
child support services is made, inform the applicant that neither the
Title IV-D agency nor any attorney who provides services under this
chapter is the applicant’s attorney and that the attorney providing
services under this chapter does not provide legal representation to
the applicant.
8
Id. This statutory provision does not indicate that—in collecting child support
pursuant to an assignment of child support rights from Denise—the OAG is
performing a state function;3 it simply statutorily defines the parameters of the
relationship between an attorney employed to provide Title IV-D services and the
individual receiving the services.
It is true, as the OAG contends here, that as a general rule when a unit of
government is exercising its governmental powers, it is not subject to estoppel.
See State v. Durham, 860 S.W.2d 63, 67 (Tex. 1993) (no estoppel against state
asserting right to royalties from mineral interest retained by state in permanent
school fund lands); City of Hutchins v. Prasifka, 450 S.W.2d 829, 835–36 (Tex.
1970) (no estoppel against city exercising zoning power to classify land as
residential); City of San Antonio v. Pigeonhole Parking of Tex., 311 S.W.2d 218,
223 (Tex. 1958) (no estoppel against city to compel issuance of permit for curb
cut and a driveway across sidewalk); Tex. Co. v. State, 281 S.W.2d 83, 88–89
(Tex. 1955) (no estoppel against state seeking recovery of public school lands
improperly conveyed or value of minerals produced from those lands); Rolison v.
Puckett, 198 S.W.2d 74, 77–78 (Tex. 1946) (no estoppel against a city asserting
a tax foreclosure); City of San Angelo v. Deutsch, 91 S.W.2d 308, 310 (Tex.
1936) (no estoppel against city to assert a tax lien). The rationale for this general
rule is that a unit of government cannot be estopped from exercising its
3
The OAG here filed only notice of registration of a foreign (California)
judgment and an enforcement action.
9
governmental powers by the actions of its employees or by those persons
charged with administration of the unit of government:
The rule that a city is not estopped by the mistakes or
unauthorized or wrongful acts of its officers or agents is thus stated
in Ruling Case Law: ―No estoppel can grow out of dealings with
public officers of limited authority, and the doctrine of equitable
estoppel cannot ordinarily be invoked to defeat a municipality in the
prosecution of its public affairs because of an error or mistake of, or
because of a wrong committed by, one of its officers or agents which
has been relied upon by a third party to his detriment. So a
municipality is not estopped by the unauthorized acts of its officer or
agent, or by his wrongful act. Nor can an estoppel result from official
fraud and corruption.‖
City of San Angelo, 91 S.W.2d at 310; see also Durham, 860 S.W.2d at 68
(recognizing that the acts and conduct of state’s officers and agents cannot estop
state from recovering royalties from mineral interest owned by state under
permanent school fund lands).
The rationale for the general rule that a unit of government cannot be
estopped from exercising its governmental powers by the actions of its
employees or by those persons charged with administration of the unit of
government is not, however, applicable when the alleged estoppel is based not
on the action of the governmental employees but on the actions of an obligee
who assigned child support rights to the OAG. See Kawazoe, 849 S.W.2d at
910–11 (holding estoppel applied based on mother’s fraudulent conduct in
leading father to believe his parental rights had been terminated); LaRue, 832
S.W.2d at 392–95 (holding estoppel applied based on mother’s conduct in failing
to notify father of her unilateral decision to not terminate father’s parental rights);
10
see also Hall, 2007 WL 2127133, at *3 (holding estoppel applied based on
mother’s conduct). As previously mentioned, an assignee like the OAG takes the
rights assigned to it subject to all defenses that the opposing party might be able
to assert against his assignor—in this case, Richard’s right to assert the defense
of estoppel against Denise. See Kawazoe, 849 S.W.2d at 910–11; LaRue, 832
S.W.2d at 392–95. It makes no sense to hold that the OAG, suing on Denise’s
behalf and asserting Denise’s child support rights by virtue of her assignment, is
not subject to the defense of estoppel but that if Denise herself had filed the suit
to enforce child support, she would have been subject to the defense of estoppel.
To so hold would encourage a parent who was awarded child support to replicate
what appears to have happened here—to procure an affidavit of relinquishment
from the obligor-parent, to never file suit to terminate the obligor-parent’s parental
rights, to wait for a child support arrearage to accrue because the obligor-parent
believes that his parental rights have been terminated, to exclude the obligor
from the child’s life until the child is almost an adult or is an adult, to forego filing
suit on her own behalf because the defense of estoppel would apply, and to
instead make an assignment to the OAG to collect the child support arrearage
based on the assumption that the defense of estoppel does not apply to the
OAG.
Finally, the provision of child support enforcement services does not seem
to be an exercise of sovereign power like the powers exercised by the state or by
cities in the Texas Supreme Court cases that recognize when a unit of
11
government is exercising its governmental powers, it is not subject to estoppel.
See Durham, 860 S.W.2d at 67 (―the State in its sovereign capacity‖ acting to
collect royalties); City of Hutchins, 450 S.W.2d at 835–36 (city classifying land as
residential); City of San Antonio, 311 S.W.2d at 223 (city declining to issue permit
for curb cut and a driveway across sidewalk); Tex. Co., 281 S.W.2d at 88–89
(state recovering public school lands improperly conveyed or value of minerals
produced from those lands); Rolison, 198 S.W.2d at 77–78 (city asserting a tax
foreclosure); City of San Angelo, 91 S.W.2d at 309 (city asserting tax lien).
Two courts of appeals that have addressed the issue of whether the
defense of estoppel is available in a suit against the OAG to collect unpaid child
support have answered the issue in the negative. See T.L.K., 90 S.W.3d at
839–40; Rider v. Office of the Attorney Gen., No. 12-05-00418-CV, 2007 WL
3015455, at *5 (Tex. App.—Tyler Oct. 17, 2007, no pet.) (mem. op.). The
opinions of our sister courts are not binding on us, and we decline to follow them
because they do not analyze or address the fact that the OAG provides child
support collection services pursuant to an assignment from the obligee or the fact
that the OAG is not performing a state function in collecting child support. See,
e.g., Mitchell v. John Wiesner, Inc., 923 S.W.2d 262, 264 (Tex. App.––Beaumont
1996, no writ) (holding opinions of sister court are not binding on other courts of
appeal).4
4
The OAG also cites In re M.C.R., 55 S.W.3d 104, 107 (Tex. App.––San
Antonio 2001, no pet.). In M.C.R., the San Antonio Court of Appeals recognized
12
The OAG also points to Reyna v. Attorney General of Texas, 863 S.W.2d
558, 558–59 (Tex. App.—Fort Worth 1993, no writ) as supporting its position. In
Reyna, the OAG sued to determine paternity, to recoup public funds expended
on the child, and to collect child support; we held that the defense of laches was
not available in the paternity suit and that because the OAG sued within
limitations to recoup public funds and to collect child support, ―Reyna cannot
assert the defense of laches.‖ Id. at 559. Thus, our holding in Reyna was limited
to the inapplicability of a pure time-driven laches defense; we did not address
whether the OAG was subject to the defense of estoppel based on the conduct of
the assignor/obligee. See Attorney Gen. of Tex. v. Duncan, 929 S.W.2d 567,
572 (Tex. App.––Fort Worth 1996, no writ) (citing Reyna for the proposition that
―laches is not a defense available against the Attorney General in a paternity
suit‖).
Based on our de novo review, we hold that the trial court erred by
concluding as a matter of law that the defense of estoppel is not available to
Richard in the enforcement suit filed by the OAG as an assignee of Denise’s
rights to child support payment. We sustain Richard’s sole point.
that the OAG possessed standing to appeal after it obtained a judgment in a child
support action pursuant to ―the assignment of rights from Riou.‖ Id. No holding
in M.C.R. conflicts with our holding here that the defense of estoppel is available
in a suit to enforce unpaid child support brought by the OAG in its capacity as an
assignee.
13
IV. CONCLUSION
Having sustained Richard’s sole point, we reverse the trial court’s
judgment and remand for the trial court to conduct a new hearing at which
Richard may present evidence on his affirmative defense of estoppel.
SUE WALKER
JUSTICE
PANEL: LIVINGSTON, C.J.; GARDNER and WALKER, JJ.
DELIVERED: June 2, 2011
14