00-004530 Donald Baldwin vs. Department Of Revenue, Child Support Enforcement Program Status: Closed Recommended Order on Thursday, May 3, 2001.

Summary: Department proved the arrearage and notice. Petitioner raised a conflicting Social Security reimbursement claim that this forum lacks jurisdiction to consider.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DONALD L. BALDWIN, )

)

Petitioner, )

)

vs. ) Case No. 00-4530

)

DEPARTMENT OF REVENUE, CHILD )

SUPPORT ENFORCEMENT PROGRAM, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a final hearing was held in this case

before Stephen F. Dean, Administrative Law Judge, Division of

Administrative Hearings, on March 27, 2001. The hearing was

conducted by telephone conferencing between the Tarpon Springs

Work Release Center and Tallahassee, Florida.

APPEARANCES

For Petitioner : Donald L. Baldwin

D.C. No. 048444

Tarpon Springs Work Release Center

566 Brady Road

Tarpon Springs, Florida 34689

For Respondent : Albert Thorburn, Esquire

Department of Revenue

Post Office Box 8030

4070 Esplanade Way

Tallahassee, Florida 32314-8030

STATEMENT OF THE ISSUES

The issues for determination are: (1) whether Petitioner

owes overdue child support arrears; and (2) whether Respondent

is authorized to levy Petitioner’s bank account at the MacDill

Federal Credit Union, Tampa, Florida, and apply the funds to

reduce or satisfy Petitioner’s past due child support

obligation.

PRELIMINARY STATEMENT

On or about August 10, 2 000, Respondent, the Department of

Revenue, Child Support Enforcement Program (Department), sent a

Notice of Intent to Levy to Petitioner, Donald L. Baldwin

(Petitioner). In the notice, the Department advised Petitioner

that it intended to levy on Petitioner’s personal property, in

the form of liquid assets, in the control of the MacDill Federal

Credit Union, Tampa, Florida. According to the notice, the

proposed action was being taken because of Petitioner’s failure

to pay child support in the amount of $5,289.15. Petitioner

challenged the Department’s intended action and requested an

administrative hearing. On or about November 2, 2000, the

Department referred the matter to the Division of Administrative

Hearings to conduct the hearing.

Pursuant to Not ice of Hearing by Video Teleconference

(Notice) issued on February 21, 2000, the final hearing in this

case was initially set for March 27, 2001, in Monticello and

Tallahassee, Florida. The hearing convened by telephonic

conference at the time designated in the Notice, but Petitioner

telephoned from the Tarpon Springs Work Release Center to which

he had been transferred. Petitioner and Respondent’s counsel

and witnesses, and the undersigned were present for the final

hearing.

At the final hearing, Petiti oner testified in his own

behalf. Respondent presented the testimony of two witnesses,

Denise Buchanan and Russell Davis, employees of the Department.

Respondent offered seven exhibits into evidence, some of these

admitted conditionally pending production of court-certified

copies. The record was held open for 15 days, to allow the

parties to supplement their exhibits. The undersigned allowed

Respondent to submit court-certified copies to replace

photocopied documents admitted into evidence conditionally.

Petitioner was permitted to submit, within 15 days from the

hearing , a letter from the Social Security Administration

concerning overpayments made to Petitioner and requesting

repayment. Petitioner and Respondent timely submitted these

documents which were received into evidence. Petitioner

submitted a written closing argument in the form of a letter.

Respondent also submitted a written closing argument, and

proposed findings. The post-hearing submittals were read and

considered.

FINDINGS OF FACT

1. On April 21, 1994, a circuit court judge in the Circuit

Court, in and for Duval County, Florida (Circuit Court), issued

Final Judgment determining paternity and establishing support in

Case No. 94-929-FM, in the case of Loquita D. Taylor and the

State of Florida, Department of Health and Rehabilitative

Services vs. Donald L. Baldwin . The Final Judgment established

that Petitioner was the legal parent of Ashley Marie Taylor,

born March 25, 1993, and that Petitioner owed to the State of

Florida $1337.00 in public assistance. The Final Judgment

ordered Petitioner to pay $35.00 per week child support through

the court support depository.

2. In October 1998, Petitioner made one lump sum payment

of $3,983.85 towards his child support.

3. At the hearing held December 2, 1998, in Case

No. 94-929-FM, the court-appointed Hearing Officer held

Petitioner “in willful indirect contempt of this Court for

failure to pay child support as ordered while having the ability

to pay.” Based on the child support payment records of the

court depository, the court-appointed Hearing Officer found

Petitioner was “in arrears in Court ordered child support in the

amount of $5,858.15 through the payment due December 2, 1998.”

4. On December 14, 1998, the Circuit Court adopted the

Recommendations of its Hearing Officer as its order.

In paragraph 12 of those Recommendations, which became order of

the Circuit Court, the Circuit Court suspended enforcement of

Petitioner’s ongoing child support, so long as the minor child

received Social Security on behalf of Petitioner, but ordered

Petitioner “to pay $140.00 per month towards the arrearages.”

5. The Mandatory Addendum to the December 14, 1998,

Circuit Court Order on Motion for Contempt instructed Petitioner

to “immediately notify” the Clerk of the Court and the

Department of Revenue, Office of Child Support Enforcement “in

writing, of any change of residence or employment. Failure to

receive notice of a future hearing because of a party’s failure

to comply with this requirement will not be a

defense. . . . " ( emphasis in original)

6. In 1999, according to the records of the Clerk of the

Court, Petitioner made only two payments, for a combined total

of $560.00, towards his December 2, 1998, arrears of $5,858.15.

These two payments brought his outstanding arrears to $5,298.15.

Petitioner made his last child support payment towards the

arrears on May 7, 1999.

7. To collect the unpaid arrearages, the Department sent a

Notice to Freeze to the MacDill Federal Credit Union in Tampa,

Florida, on August 3, 2000. In the notice, which was sent by

certified mail, the Department advised the MacDill Federal

Credit Union that Petitioner had a past due and/or overdue

child-support obligation of $5,289.15 as of August 3, 2000.

Moreover, the Department directed the bank not to transfer,

dispose of, or return any credits, debts, or other personal

property owned by or owed to Petitioner.

8. On August 7, 2000, the MacDill Federal Credit Union

verified that it had frozen the savings account identified as

belonging to Petitioner. Petitioner had $2,814.41 in his

savings account.

9. On August 10, 2000, the Department sent a Notice of

Intent to Levy by certified mail to Petitioner at his last known

address. That notice provided in pertinent part the following:

You are hereby notified that pursuant to

Section 409.25656, Florida Statutes, the

Department of Revenue intends to levy on

credits, or personal property belonging to

the obligor named above [Petitioner], or

debts owed to the obligor. The property

consists of liquid assets and is in the

control of MACDILL FCU.

This action is taken for nonpayment of child

support by the obligor in the amount of

$5,289.15 1 as of 08/03/2000 .

You are hereby notified that you may contest

the agency’s action to levy on the above

referenced property. You may do so by

either filing an action in Circuit Court or

by requesting an administrative hearing. If

you wish to request an administrative

hearing, you must file your petition for

hearing, in writing, in accordance with the

Notice of Rights attached to this Notice.

If you elect to file an action in Circuit

Court, your complaint must be filed with the

Clerk of Court within twenty-one (21) days

of your receipt of this notice. . . .

You may NOT request both an administrative

hearing and a hearing in circuit court.

* * *

NOTICE TO A NONOBLIGOR JOINT OWNER:

If you claim you have an equal right to all

of the money levied upon in a joint account,

these hearing rights apply to you.

(Emphasis in original.) Attached to the Notice of Intent to

Levy were a Notice of Rights form that detailed the due process

rights as provided for in Section 409.25656, Florida Statutes

and a copy of Rules 28-106.201 and 28-106.301, Florida

Administrative Code.

10. On or about August 21, 2000, Petitioner timely filed

an initial Petition for Formal Hearing (Petition), which

requested a “formal hearing concerning the Notice of Intent to

Levy.”

11. On or about August 21, 2000, the Department issued and

sent a Notice of Extension of Freeze to the MacDill Federal

Credit Union. The notice advised the bank that Petitioner had

“filed an action in the circuit court or under Chapter 120,

Florida Statutes, to contest the Department of Revenue’s

intention to levy upon assets as specified in the Notice of

Freeze.” The Department further directed the MacDill Federal

Credit Union not to transfer, dispose, or return any credits,

debts or other personal property owned/controlled by Petitioner

and in the bank’s possession and control. Finally, the Notice

of Extension of Freeze stated that the Notice remained effective

“until final resolution of the circuit court or Chapter 120

action, and the Department issued a Notice of Levy or a Notice

of Full or Partial Release of Freeze.”

12. The Department dismissed the initial Petition without

prejudice because it was not in substantial compliance with

either Rule 28-106.201 or, alternatively, Rule 28-106.301,

Florida Administrative Code, and allowed Petitioner an

opportunity to file an amended petition.

13. Petitioner timely filed an amended Petition (Amended

Petition), which was in substantial compliance with the Rules.

On or about November 2, 2000, the Department referred the matter

to the Division of Administrative Hearings to conduct the

hearing.

14. Petitioner submitted as a late-filed exhibit a Billing

Statement, dated March 7, 2001, and a Pay Stub from the Social

Security Administration concerning benefits of $1,664.00 paid in

error to Petitioner and requesting repayment in full either

“right away” or by “smaller amount monthly over a longer period

of time.” The Payment Stub that accompanied the Billing

Statement indicated that the overpayment could be repaid by

check, by money order, or by MasterCard, Visa, or Discover.

15. The statement from MacDill Federal Credit Union for

October 1, 2000, through December 31, 2000, supplied by

Petitioner indicates that he had a savings account balance of

$2,862.22.

16. Petitioner's uncon troverted testimony was that he is

totally disabled, and his sole income is from Social Security.

Petitioner asserted all the money in the account was from Social

Security payments.

CONCLUSIONS OF LAW

17. The Division of Administrative Hearings has

jurisdiction over the parties to and the subject matter of this

proceeding. Section 120.57(1), Florida Statutes.

18. The Department of Revenue is the state agency

responsible for the administration of the Child Support

Enforcement Program. Section 409.2557(1), Florida Statutes.

19. Section 409.2557(2), Florida Statutes, provides in

pertinent part the following:

(2 ) The department in its capacity as the

state Title IV-D agency shall have the

authority to take actions necessary to carry

out the public policy of ensuring that

children are maintained from resources of

their parents to the extent possible. The

department's authority shall include, but

not be limited to, the establishment of

paternity or support obligations, as well as

the modification, enforcement, and

collection of support obligations.

20. The burden of proof, absent a statutory directive to

the contrary, is on the party asserting the affirmative of the

issue in the proceeding. Department of Transportation v. J.W.C.

Company, Inc. , 396 So. 2d 778 (Fla. 1st DCA 1981) ; Balino v.

Department of Health and Rehabilitative Services , 348 So. 2d 349

(Fla. 1st DCA 1977). In this proceeding, the Department seeks

to levy the overdue child support from Petitioner's bank

accounts. Therefore, to prevail in this proceeding, the

Department must establish by a preponderance of evidence the

alleged facts necessary to show that the proposed levy is

authorized by Section 409.25656, Florida Statutes. Petitioner

seeks to contest the Department’s levy.

21. Section 409.25656, Florida Statutes, provides in

pertinent part the following:

Garnishment:

(1 ) If a person has a child support

obligation which is subject to enforcement

by the department as the state Title IV-D

program, the executive director or his or

her designee may give notice of past due

and/or overdue support by registered mail to

all persons who have in their possession or

under their control any credits or personal

property, including wages, belonging to the

child support obligor, or owing any debts to

the child support obligor at the time of

receipt by them of such notice. Thereafter,

any person who has been notified may not

transfer or make any other disposition, up

to the amount provided for in the notice, of

such credits, other personal property, or

debts until the executive director or his or

her designee consents to a transfer or

disposition, or until 60 days after the

receipt of such notice. If the obligor

contests the intended levy in the circuit

court or under chapter 120, the notice under

this section shall remain in effect until

final disposition of that circuit court or

chapter 120 action. Any financial

institution receiving such notice will

maintain a right of setoff for any

transaction involving a debit card occurring

on or before the date of receipt of such

notice.

(2 ) Each person who is notified under

this section must, within 5 days after

receipt of the notice, advise the executive

director or his or her designee of the

credits, other personal property, or debts

in their possession, under their control, or

owed by them and must advise the executive

director or designee within 5 days of coming

into possession or control of any subsequent

credits, personal property, or debts owed

during the time prescribed by the notice.

Any such person coming into possession or

control of such subsequent credits, personal

property, or debts shall not transfer or

dispose of them during the time prescribed

by the notice or until the department

consents to a transfer.

(3 ) During the last 30 days of the 60-day

period set forth in subsection (1), the

executive director or his or her designee

may levy upon such credits, personal

property, or debts. The levy must be

accomplished by delivery of a notice of levy

by registered mail, upon receipt of which

the person possessing the credits, other

personal property, or debts shall transfer

them to the department or pay to the

department the amount owed to the obligor.

* * *

(7)(a ) Levy may be made under subsection

(3) upon credits, other personal property,

or debt of any person with respect to any

past due or overdue child support obligation

only after the executive director or his or

her designee has notified such person in

writing of the intention to make such levy.

(b ) Not less than 30 days before the day

of the levy, the notice of intent to levy

required under paragraph (a) must be given

in person or sent by certified or registered

mail to the person's last known address.

(c ) The notice required in paragraph (a)

must include a brief statement that sets

forth:

1. The provisions of this section

relating to levy and sale of property ;

2. The procedures applicable to the levy

under this section;

3. The administrative and judicial

appeals available to the obligor with

respect to such levy and sale, and the

procedures relating to such appeals; and

4. The alternatives, if any, available to

the obligor which could prevent levy on the

property.

* * *

(8 ) An obligor may contest the notice of

intent to levy provided for under subsection

(7) by filing an action in circuit court.

Alternatively, the obligor may file a

petition under the applicable provisions of

chapter 120. After an action has been

initiated under chapter 120 to contest the

notice of intent to levy, an action relating

to the same levy may not be filed by the

obligor in circuit court, and judicial

review is exclusively limited to appellate

review pursuant to s. 120.68. Also, after

an action has been initiated in circuit

court, an action may not be brought under

chapter 120.

22. The provisions above enumerate the prerequisites that

must be met prior to the Department's levying upon a person's

credits, personal property, or debts. First, the Department

must determine that the person has a child-support obligation

that is subject to enforcement by the Department. If the

Department determines that the obligor has a past due or overdue

child-support obligation that is subject to enforcement by the

Department, the Department must demonstrate that there has been

compliance with the notice requirements enumerated in Section

409.25656, Florida Statutes.

23. Prior to levying upon the credits, personal property,

or debts of any child-support obligor, the Department is

required to give notice by registered mail to all persons known

to have in their possession or under their control any credits

or personal property belonging to the obligor or owing any debts

to that obligor of its intent to levy. The notice should direct

such person not to transfer or dispose of the credits, personal

property, or debts until the Department consents to a transfer

or disposition or until 60 days after receipt of the notice.

Section 409.25656(1), Florida Statutes. Next, persons who

receive the foregoing notice are required to advise the

Department of credits or other personal property owned by the

obligor, or debts owed by them to the obligor, that are in their

possession or under their control. Section 409.25656(2),

Florida Statutes. Finally, prior to the Department's levying

upon credits, other personal property, or debts of a child-

support obligor, it must provide notice to the obligor that

comports with the requirements of Section 409.25656(7), Florida

Statutes.

24. The evidence established that Petitioner had a past

due or overdue child-support obligation, subject to enforcement

by the Department, of $5,298.15 in arrears. Petitioner made his

most recent payment towards his court-ordered arrears on May 7,

1999.

25. The evidence established that the Department gave the

statutorily mandated notice to the financial institution,

MacDill Federal Credit Union, that had personal property owned

by Petitioner in its possession and under its control.

Additionally, the undisputed evidence showed that at the time

the MacDill Federal Credit Union received the Notice of Freeze,

it had in its possession and under its control, personal

property owned or controlled by Petitioner. This personal

property was in the form of liquid assets, specifically, funds

in a savings account totaling $2,814.41.

26. Finally, the evidence established that the Department

issued to Petitioner a Notice of Intent to Levy which (1)

notified Petitioner that the Department intended to levy upon

his personal property, liquid assets, in the control of the

MacDill Federal Credit Union; (2) stated that the action was

being taken for Petitioner's nonpayment of overdue or past-due

child support; and (3) advised Petitioner of his due process

rights. This notice provided to Petitioner by the Department

fully complied with the requirements of Section 409.25656 (7),

Florida Statutes.

27. In his Amended Petition and testimony, Petitioner

stated that he wished to apply the frozen funds for his own

benefit to pay for, among his other personal needs, a place to

live upon his release from prison.

28. Petitioner mentioned at the hearing for the first

time, that the Social Security Administration had made a demand

for repayment of benefits paid in error to him while he was

incarcerated. Petitioner filed as a late-filed exhibit, a

Social Security Administration Billing Statement dated March 7,

2001. The Billing Statement confirmed that Petitioner owed an

overpayment of Social Security Benefits of $1,664.00 paid in

error and indicated that the overpayment could be repaid by

check, by money order, or by MasterCard, Visa, or Discover.

29. Title 42 of the United States Code, at 42 U.S.C.

Sections 402(x) and 404(j), limits payments to prisoners and

certain other inmates of publicly funded institutions, where an

otherwise eligible person is confined for more than 30

continuous days due to the conviction of a crime. If

overpayments occur in such circumstances, then Title 42 provides

procedures for the Social Security Administration to adjust or

recover overpayments.

30. Pursuant to this section of the Social Security Act,

the Social Security Administration has a number of remedies

available to recoup its overpayments. It can, for example,

(1) decrease payments temporarily to the overpaid person;

(2) require the overpaid person to refund the excess; (3) reduce

the overpaid person’s tax refunds; or (4) apply any combination

of the above. See 42 U.S.C. Section 404. However, Congress has

not established in 42 U.S.C. Section 404 a priority for recovery

of a Social Security Administration overpayment over other

interests or claims on an obligor’s financial resources.

31. In addition to the Billing Statement from the Social

Security Administration, Petitioner supplied an account

statement from MacDill Federal Credit Union for October 1, 2000,

through December 31, 2000, showing a balance of $2,826.22. The

origin of the funds, i.e. , whether any of the funds frozen in

his savings account are funds derived from the Social Security

Administration, is immaterial.

32. Petitioner introduced evidence of a demand from Social

Security Administration for repayment of overpayments made to

him during his incarceration. However, this forum is without

authority to adjudicate conflicting claims and Petitioner has

not noticed Social Security Administration of his inability to

repay the funds because his account is frozen and requested a

voluntary of the case so that these issues could be addressed by

the Circuit Court. Similarly, neither Petitioner nor Respondent

has noticed MacDill Federal Credit Union of the potentially

conflicting claims. 2

33. The Social Security Administration undoubtedly will

recoup the money from future payments to Petitioner, whose

ability to pay must be reexamined every three years by the

Circuit Court. Because Petitioner's principal source of income

is his social security payments, this action diminishes his

future ability to repay his arrearage, and may cause the court

to reduce future payments on the arrearage. In summary, the

children may benefit now or later. One can only speculate

regarding the impact of the lack of notice of the completing

claims on the Credit Union and the Social Security

Administration.

34. Despite Petitioner’s argument that he was not given

proper notice of the Department’s intent to levy because the

Department mailed its Notice by certified mail to a last known

address, in satisfaction of the requirements of Section

409.25656(7)(b), Florida Statutes, instead of his then-present

address, Petitioner’s timely filing of his initial Petition,

less than two weeks after the Department mailed the Notice of

Intent to Levy to his last known address, is prima facie

evidence that Petitioner received the Notice of Intent to

Levy. 3

35. The Department has met its burden of proof in this

proceeding. Therefore, the Department is authorized to levy on

Petitioner's aforementioned savings account, and to apply those

levied funds to his past due child support obligation.

RECOMMENDATION

Based upon the foregoing F indings of Fact and Conclusions

of Law, it is hereby

RECOMMENDED that the Department of Revenue enter a final

order that (1) levies such funds as available in Petitioner's

savings account at the MacDill Federal Credit Union up to the

amount of his arrears; (2) applies the funds to reduce

Petitioner's past due child support obligation; and (3) credits

Petitioner for said payment.

DONE AND ENTERED this 3rd day of May, 2001, in Tallahassee,

Leon County, Florida.

___________________________________

S TEPHEN F. DEAN

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488- 9675 SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 3rd day of May, 2001.

ENDNOTES

1/ The scrivener's error carried over to the new document.

2/ This case presents an unusual factual situation in which,

after the notice by Respondent and election for a Chapter 120

proceeding, the Social Security Administration made demand upon

Petitioner for repayment of a portion of the funds subject to

levy. A sophisticated litigant might have requested this cause

be dismissed and requested that proceedings be initiated in

Circuit Court after notice to the Social Security Administration

of the frozen assets, and notice to the Credit Union of the

social security claim. Unfortunately, this did not occur which

raises potential practical problems regarding future payments.

3/ The Circuit Court ordered to the Petitioner to keep the

Clerk of the Court and the Department of Revenue, Office of

Child Support Enforcement informed "immediately . . . in writing

of any change of residence or employment." The Petitioner

cannot claim a change of residence as a defense to the

Department 's garnishment action under Section 409.25656, Florida

Statutes .

COPIES FURNISHED:

Albert Thorburn, Esquire

Florida Department of Revenue

Post Office Box 8030

4070 Esplanade Way

Tallahassee, Florida 32314-8030

Donald L. Baldwin

D.C. Number 048444

Tarpon Springs Work Release Center

566 Brady Road

Tarpon Springs, Florida 34689

James Zingale, Executive Director

Department of Revenue

5050 West Tennessee Street

104 Carlton Building

Tallahassee, Florida 32399-0100

Linda Lettera, General Counsel

Department of Revenue

204 Carlton Building

Post Office Box 6668

Tallahassee, Florida 32314-6668

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the final order in this case.