Powers v. Office of Child Support

Powers v. Office of Child Support (2000-335); 173 Vt. 390; 795 A.2d 1259

[Filed 05-Apr-2002]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal  revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of  Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any  errors in order that corrections may be made before this opinion goes
  to press.


                                No. 2000-335


Katherine Powers	                         Supreme Court

                                                 On Appeal from
     v.	                                         Chittenden Superior Court


Office of Child Support	                         September Term, 2001


Matthew I. Katz, J.

Charlotte Dennett, Burlington, for Plaintiff-Appellant.

William H. Sorrell, Attorney General, Montpelier, and Donelle Smith Staley, 
  Assistant Attorney General, Waterbury, for Defendants-Appellees.


PRESENT:  Amestoy, C.J., Morse, Johnson, Skoglund, JJ., and 
          Allen, C.J. (Ret.), SpeciallyAssigned


       SKOGLUND, J. Plaintiff Katherine Powers appeals from a superior court
  judgment  dismissing her claims against defendants State of Vermont, Office
  of Child Support ("OCS"), and  eleven of its current and former employees
  for failure to state a claim upon which relief can be  granted under
  V.R.C.P. 12(b)(6). (FN1)


  

       Specifically, Powers claims that the Vermont OCS failed to adequately
  represent her in  seeking enforcement of child support orders against her
  ex-husband.  She argues that the court erred  in determining that her
  claims against the State and OCS were barred by the doctrine of sovereign 
  immunity and that her claims against the individual defendants were barred
  by 12 V.S.A. § 5602(a).   She claims, too, that the court erred in failing
  to consider her breach of contract claim.  We affirm.

       When reviewing a motion to dismiss we accept as true all well-pleaded
  factual allegations in  the complaint.  Richards v. Town of Norwich, 169
  Vt. 44, 48-49, 726 A.2d 81, 85 (1999).  The  complex factual background of
  this case spans nearly twenty years.  The following facts as alleged  by
  Powers are taken as true. (FN2)  Powers, a Vermont resident, filed for a
  divorce from her  husband, James Horner, in 1978.  In the final divorce
  decree, she retained custody of their two  children, Lauren, born in 1968,
  and David, born in 1973.  Horner moved to New York after the  divorce.  The
  New York court ordered Horner to pay $250 a month in child support.  Powers
  filed a  URESA (FN3) petition with the State of New York in 1978 to enforce
  the payment of child support.

       Powers received public assistance from the State of Vermont from 1978
  through 1981.   Pursuant to the conditions of eligibility for this program,
  Powers assigned her right to receive child  support payments to the
  Department of Social Welfare ("DSW").  OCS sporadically pursued Horner 

 

  for payment on arrearages that accrued during the assignment of rights,
  monies that would then go to  reimburse the state, but otherwise virtually
  ignored the Vermont family court order. 

       From 1978 through 1991, Powers repeatedly requested assistance from
  OCS in enforcing the  child support orders.  She claims that OCS failed to
  inform her of hearings that took place in the  New York family court and of
  the fact that arrearages were twice reduced by IRS tax offset  payments,
  once in 1988, and once in 1990.  In October 1989, OCS sent Powers a check
  for $50, the  first child support payment she had received since the
  divorce in 1978.  She received $50 monthly  payments from January 1990
  through August 1990.  In 1991, Powers learned that OCS had been 
  withholding $3,125 owed to her.  She was finally paid that money in
  September 1991.  In 1992, OCS  began to seek enforcement of the 1979
  Vermont family court order by filing a petition for  enforcement in the New
  York court.  However, OCS did not follow up on that petition until mid-
  November when it learned from the New York court that the petition had been
  misplaced.  Powers  was not informed that the petition had been misplaced.

       In response to Powers's requests for assistance, OCS sent her a
  package to formally apply for  services in 1992.  She applied for tracking
  services, assets location services, enforcement services,  and trial
  services.  Following a meeting with OCS employees Van Schaick and Calkins
  in November  1992, Powers expected OCS would act on her case.  She did not
  agree to get her own lawyer.  She  claims that an explanation provided by
  Van Schaick was "misleading" concerning the URESA  petition.  Her complaint
  also alleges that, in 1993, OCS put the wrong social security number on 
  their enforcement forms, thereby impeding enforcement remedies.

       In 1993, OCS filed a foreign support order with the State of New York. 
  Following hearings  held in New York for the purpose of enforcing child
  support arrears, Horner was ordered to pay 

 

  $10,000 up front and $500 per month towards arrearages, which at that time
  totaled over $120,000.   According to her complaint, Powers was not
  informed of this decision and she was denied access to  the transcripts and
  pleadings connected with this enforcement action.  Furthermore, in 1994,
  she was  denied a referral to the United States Attorney's Office for
  criminal prosecution of Horner, a referral  which is usually given when
  OCS's enforcement efforts have failed. 

       On December 12, 1995, Powers was sent a copy of a November 30, 1995
  order from the New  York judge holding that Horner would not be
  incarcerated for his years of willful nonpayment.  She  was not informed of
  her right to appeal or be heard.  By the time she learned that OCS would
  not  appeal the decision, the appeal period had passed.  

       OCS consistently misstated the amount of arrears owed to Powers, in
  part because the  computer system could not handle amounts over $100,000. 
  In addition, from 1994 to 1997, OCS,  through Defendants Relyea, Barrett
  and Patton, repeatedly refused Powers access to her records. 

       Powers hired her own attorney in 1997. 

                           I.  Procedural History

       Powers initially filed her action in the Chittenden Superior Court,
  claiming that OCS and the  individual defendants violated her rights under
  federal and state law.  Defendants removed the case  to the Federal
  District Court for the District of Vermont based on Powers' claim that the
  defendants'  acts and omissions violated her rights under federal law in
  violation of 42 U.S.C. § 1983.  In federal  court defendants moved to
  dismiss all claims, alleging that there was no private right of action
  under  Title IV-D, and that the state was shielded from suit by the
  Eleventh Amendment.  The District  Court, Neidermeier, J., dismissed
  Powers's  federal claims, holding that the defendants were shielded  from
  suit by the doctrine of qualified immunity because the right alleged by
  Powers, stemming from 

 

  an individual cause of action for non-compliance with Title IV-D
  regulations, was not clearly  established at the time the alleged
  violations took place.  The District Court returned Powers's state  law
  claims of breach of duty of effective representation, breach of contract,
  tortious interference with  Powers's efforts to mitigate damages, and fraud
  to the superior court.  Defendants then filed in the  superior court a
  motion to dismiss for failure to state a claim, arguing that the action
  against the State  was barred by the doctrine of sovereign immunity, and
  the action against the employees was barred  by 12 V.S.A. § 5602(a) because
  Powers failed to state a claim for gross negligence or willful  misconduct. 
  In the alternative, defendants argued that the named employees were
  entitled to  qualified immunity.  The superior court, relying on Noble v.
  Office of Child Support, 168 Vt. 349,  721 A.2d 121 (1998), held that the
  duties of the OCS are discretionary and without a private analog  in
  statutory or common law and thus dismissed the remaining claims.  This
  appeal followed. 

                          II.  Statutory Background

       In 1974, Congress added Title IV, Part D to the Social Security Act
  (the "Act").  See 42  U.S.C. §§ 651-669.  The IV-D amendment established a
  Child Support Enforcement Program for,  among other things, "the purpose of
  enforcing the support obligations owed by noncustodial parents  to their
  children. . . ."  42 U.S.C. § 651.  The child support enforcement services
  contemplated by the  program include creating a system for establishing
  paternity, locating absent parents, and helping   families obtain support
  orders.  The Act requires that each state develop and implement a plan, 
  subject to federal approval, for delivery of child support program services
  in order to qualify for  federal funds in providing those services.  42
  U.S.C. § 654.  OCS is the designated IV-D agency for  the purpose of Title
  IV-D.  See 33 V.S.A. § 4101.  A state must provide these services free of
  charge  to AFDC (Aid to Families with Dependent Children) recipients and,
  when requested, for a nominal 

 

  fee to children and custodial parents who are not receiving AFDC payments. 
  42 U.S.C. §§ 651,  654(4); see Blessing v. Freestone, 520 U.S. 329, 334
  (1997); Carelli v. Howser, 923 F.2d 1208, 1210  (6th Cir. 1991) ("States
  are required to provide child support enforcement services to families that 
  receive AFDC benefits as well as families that do not.") (internal
  quotation marks and citation  omitted).  
 
       In enacting Title IV-D Congress recognized that states have a
  pecuniary interest in child-support enforcement whether or not the
  custodial parent is an ANFC recipient.  One stated purpose  of Title IV-D
  was to help families avoid becoming dependent on the state through lack of
  support  from an absent parent.  See S. Rep. No. 93-1356, at 13-14, 25
  (1974),  reprinted in 1974 U.S.C.C.A.  N. 8133, 8145-46, 8158.  By
  extending child support enforcement services to those families not 
  receiving public assistance, Congress intended to assure that families have
  access to child support  services before they are forced to apply for
  welfare.  S. Rep. No. 96-336, at 77-78 (1980), reprinted  in 1980
  U.S.C.C.A.N. 1448, 1526-27.

                              III.  Discussion

       Powers contends that her complaint pleaded the elements required to
  sustain a claim of  negligence against the state and the individual
  defendants and, thus, the court erred in dismissing her  case under Rule
  12(b)(6).  A motion to dismiss for failure to state a claim upon which
  relief can be  granted should not be granted unless it is beyond doubt that
  there exist no facts or circumstances that  would entitle Powers to relief. 
  See Richards, 169 Vt. at 48, 726 A.2d  at 85, (1999); Amiot v. Ames,  166
  Vt. 288, 291, 693 A.2d 675, 677 (1997).  The purpose of a motion to dismiss
  is to test the law of  the claim, not the facts which support it.  Levinsky
  v. Diamond, 140 Vt. 595, 600,  442 A.2d 1277,  1280 (1982).  As noted
  above, on review this Court assumes all factual allegations pleaded 

 

  in the complaint are true, and we disregard all of defendants' contrary
  assertions.  See Ass'n of  Haystack Prop. Owners v. Sprague, 145 Vt. 443,
  444, 494 A.2d 122, 123 (1985). 

       We first consider whether the State has waived its sovereign immunity
  and consents to suit in  this negligence action.  "Sovereign immunity
  protects the state from suit unless immunity is  expressly waived by
  statute."  McMurphy v. State, 171 Vt. 9, 11, 757 A.2d 1043, 1045 (2000) 
  (internal quotation marks and citation omitted).  The State of Vermont has
  waived its immunity to  certain suits under 12 V.S.A. § 5601(a).  The
  statute reads in pertinent part:

    The state of Vermont shall be liable for injury to persons . . .
    caused  by the negligent or wrongful act or omission of an
    employee of the  state while acting within the scope of
    employment, under the same  circumstances, in the same manner and
    to the same extent as a private  person would be liable to the
    claimant. . . .
 
  12 V.S.A. § 5601(a).  As our caselaw makes clear, "[t]he government remains
  immune . . . for  governmental functions for which no private analog
  exists." LaShay v. Dep't of Soc. &  Rehabilitation Servs., 160 Vt. 60, 68,
  625 A.2d 224, 229 (1993).  Under the "private analog" analysis  adopted by
  this Court, the State waives its immunity only to the extent a plaintiff's
  cause of action is  comparable to a recognized cause of action against a
  private person.  Denis Bail Bonds, Inc. v. State,  159 Vt. 481, 486, 622 A.2d 495, 498 (1993).  The test is then whether the factual allegations
  "satisfy  the necessary elements of a cause of action against the State
  comparable to one that may be  maintained against a private person."  Id.
  at 487, 622 A.2d  at 498.  Under this analysis, the court  properly
  dismissed the action against the State, OCS, and the individual named
  employees. 

       Powers's claim against OCS is one of negligence, which is predicated
  upon OCS's breach of  a statutory duty of care.  Our decision in Denis
  requires that we determine whether such a duty  exists.  As noted above,
  she claims that OCS failed to adequately represent her interests in seeking 



  enforcement of child support orders against her ex-husband.  We agree with
  the trial court that our  decision in Noble controls this issue, and,
  therefore, this case.  In Noble, plaintiff brought an action  against OCS,
  alleging that it had negligently failed to comply with its statutory duty
  to assist her and  her children in enforcing a child support order.  The
  lower court denied the State's motion for  summary judgment on the basis of
  sovereign immunity, finding a private analog in the nature of a  collection
  agency for the governmental function involved.  On appeal we reversed,
  holding that OCS  enforcement actions were "broadly discretionary" and
  served a variety of state policies and interests  wholly apart from the
  collection of debts.  We found OCS's duties to be "uniquely governmental" 
  with no private analog in our common law and, therefore, the action against
  OCS was barred as a  matter of law by the doctrine of sovereign immunity. 
  Noble, 168 Vt. at 353, 721 A.2d  at 124. 

       Applying the same reasoning, the same result attends here,
  notwithstanding the fact that this  case differs from Noble in one respect. 
  In Noble, the plaintiff was a recipient of public assistance  (ANFC) who
  assigned her family's right to child support to DSW as a condition of
  receiving  government benefits.  Cf. 42 U.S.C. § 602(a)(26)(amended 1996);
  33 V.S.A. § 3902.  Here, Powers  only received state assistance for a brief
  period between 1978 and 1981, during which time, pursuant  to the
  conditions of eligibility, she assigned her right to receive child support
  payments to DSW.   From 1981 through 1991, however, Powers made informal
  requests for assistance from OCS and  then, in 1992, she formally applied
  for enforcement and legal services.  Because she was not  receiving public
  assistance, she did not assign her rights to receive child support payments
  to  OCS. (FN4)

 

  Powers argues that because she was not on public assistance, her case
  differs from the situation  presented in Noble.  She argues that OCS
  functioned more as her private advocate or collection  agency, with all the
  attendant legal obligations, rather than as a governmental body and that, 
  therefore, the reasoning of Noble and the doctrine of sovereign immunity
  does not apply.  As we did  in Noble, here, too, we disagree. 

       Vermont's statutory scheme was not intended to benefit individual
  children and custodial  parents, but was intended to benefit Vermont
  society as a whole.  Vermont law does not create a  specific duty owed by
  OCS to any particular groups of persons.  As we noted in Noble, a
  collection  agency is engaged primarily in the business of collecting debts
  owed to others.  "Its sole contractual  duty is to utilize its best efforts
  to collect the debt."  Noble, 168 Vt. at 352, 721 A.2d  at 123.  In 
  contrast, in bringing support actions on behalf of families, OCS is
  required by statute to "be guided  by the best interests of the child for
  whose benefit the action is taken."  33 V.S.A. § 4106(f).   Further, the
  Legislature has declared that "[t]he paramount interest of the state of
  Vermont is the  welfare of its children. . . .  The office of child support
  in carrying out its responsibility shall be  guided by the best interests
  of the child, but not the economic interests exclusively in an action for 
  child support."  33 V.S.A. § 4101(b).  The purpose of OCS does not change
  depending upon whether 

 

  or not the petitioner is receiving public assistance or whether the
  petitioner has assigned his or her  rights to the agency.  In neither case
  does the service provided by OCS flow to an individual, but  instead it
  flows to the welfare of the state, its children, and its fisc.  Because the
  duties of OCS are  uniquely governmental with no private analog in our
  common law, Powers's suit is barred against  the state and its agency by
  sovereign immunity.

       Powers also argues that the court erred in dismissing her complaint
  against the individual  named OCS employee defendants.  She concedes that
  the individually named defendants were acting  within the scope of their
  employment at all relevant times, but argues that their alleged wrongful 
  actions were grossly negligent and may have been malicious and willful.  

       The Tort Claims Act is an exclusive right of action, 12 V.S.A. § 5602,
  and claims based on  the act or omission of an employee of the state acting
  within the scope of employment lie against the  state of Vermont, not
  against the employee.  There is one exception:  when the claim is of gross 
  negligence or willful misconduct, an action may be brought against an
  employee, even if the act or  omission giving rise to the claim was within
  the scope of employment.  See 12 V.S.A. § 5602(b).

       The existence of a duty is primarily a question of law.  Rubin v. Town
  of Poultney, 168 Vt.  624, 625, 721 A.2d 504, 506 (1998).  Because we hold
  that Vermont law creates no specific duty  owed by OCS to any particular
  person or group of persons, Powers's allegations against the OCS  employees
  named cannot satisfy the first necessary element of a cause of action in
  negligence.   The  requisite elements of the cause of action are familiar: 
  the existence of a legally cognizable duty  owed by the defendant to the
  plaintiff, breach of that duty, such breach being the proximate cause of 
  plaintiff's injury, and actual damages.  Langle v. Kurkul, 146 Vt. 513,
  517, 510 A.2d 1301, 1304  (1986).   Here,  there is no duty owed to Powers
  as an individual by the employees of OCS for their

 

  work on behalf of the agency.  As we noted in Sorge v. State, 171 Vt. 171,
  762 A.2d 816 (2000), in a  negligence case, the issues of immunity defenses
  do not become germane until it has been  established that a defendant owes
  a plaintiff a duty of care that has been breached.  Sorge, 171 Vt. at  174,
  762 A.2d  at 818.   Therefore, Powers could not prove an action for simple
  or gross negligence  against the employees.  
 	
       Further, we note that the complaint does not make any claims against
  any individual defendant that  could be shown to constitute gross
  negligence.  Indeed, the complaint does not allege that any  employee was
  negligent, only that the actions of OCS constitutes a "long-standing
  pattern of gross  negligence and indifference to the plaintiff."    

       To sustain a claim for gross negligence, a plaintiff must present
  facts that demonstrate that an  individual defendant heedlessly and
  palpably violated a legal duty owed to plaintiff.  Mellin v. Flood  Brook
  Union Sch. Dist., et al., __ Vt. __, __, 790 A.2d 408, 423 (2001) (citing
  Shaw v. Moore, 104  Vt. 529, 531, 162 A 373, 374 (1932)).  And while it is
  generally a question for the jury as to whether  an individual was grossly
  negligent, when reasonable persons cannot differ on the question, a court 
  can decide the issue as a matter of law.  Hardingham v. United Counseling
  Serv., 164 Vt. 478, 481,  672 A.2d 480, 482 (1995).  What is alleged in
  Powers's complaint is simple incompetence,  inaccurate record keeping, and
  clerical errors.  Such claims do not rise to the level of gross 
  negligence.  We agree with the court that plaintiff's allegations fail to
  make out a case of gross  negligence. 

 

       Powers also claims that she relied on OCS to provide child support
  enforcement services in  return for consideration and that OCS breached its
  agreement and caused her damage. (FN5)  She  captioned this claim as one of
  breach of contract.  She suggests that the trial court neglected to rule 
  on this claim.  However, when determining the nature of a claim, the court
  should look to the  substance of the complaint rather than its precise
  terminology.  Stevenson v. Capital Fire Mut. Aid  Sys., Inc., 163 Vt. 623,
  625, 661 A.2d 86, 89 (1995) (mem.) (citing Kinney v. Goodyear Tire & 
  Rubber Co., 134 Vt. 571, 576, 367 A.2d 677, 680 (1976)).  Powers's claims
  are all variations on the  theme of inadequate provision of child support
  services.  The immunities discussed above  encompass Powers's additional
  claims.  As there was no contract for services, we find no error in the 
  trial court's omission. 

       Finally, Powers alleges that OCS caused her harm by failing to provide
  her access to her  files, thus preventing her from taking reasonable
  actions to mitigate damages.  This claim is made  against the agency and
  not any named individual.  Thus, it is defeated by sovereign immunity. 

       Affirmed.  
  

                                       FOR THE COURT:


                                       _______________________________________
                                       Associate Justice



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                                  Footnotes


FN1.  The Office of Child Support ("OCS") is a subdivision of the Vermont
  Agency of Human  Services and is responsible for administering the federal
  Title IV-D child support enforcement  program in Vermont.  Individual named
  defendants are: Jeffrey Cohen, the Director of OCS, and  OCS employees
  Scott Barrett, Donna Blight, Ellie Hubbell, Sparrow Calkins, Lynn Relyea,
  Tom  Rotella, Patricia Van Schaick, Marjorie Shepard, Carol Butterfield,
  Robert Patton and Barbara  Lyons.

FN2.  In her complaint Powers makes factual allegations involving both OCS
  and the Department  of Social Welfare (DSW).  The distinction is not
  critical to our decision in the case.

FN3.  The Uniform Reciprocal Enforcement of Support Act ("URESA") is a model
  act which had  been adopted in many states.  It provided for the
  enforcement of child support orders where the  dependent children reside in
  a state that cannot obtain personal jurisdiction over the parent who owes 
  support.  See generally, Unif. Reciprocal Enforcement of Support Act, 9C
  U.L.A. 273-87 (1958). 

FN4.  Though not assigning her rights to support payments to DSW, she did
  enter into an  agreement, memorialized by an Application for Child Support
  Services and a "Disclosure Statement"  that reads in pertinent part: 

    I recognize that the representative from the Office of Child
    Support  acts at all times on behalf of the Office of Child
    Support to enforce  child support laws and that he or she does not
    act in the interests of  any particular person or party. . . .
    This means that the Office of Child  Support does not act as my
    personal advocate or representative in any  legal proceedings
    before the Family Court.

  The Disclosure Statement also included the following provision:  "I
  understand the Office of Child  Support's role and my continuing right to
  get my own attorney in connection with this matter." 

FN5.  Though the record is unclear on this point, it appears that Powers did
  not pay any fee,  however nominal, when she requested services from OCS.