Keefer v. Keefer
The Court addressed: 1) when a child receives disability payments on account of a parent's disability in excess of that parent's monthly child support obligation, may the excess be used to satisfy the parent's obligation for unreimbursed medical expenses? 2) Can attorney's fees be awarded to an attorney representing a party in a pro bono capacity?
The parties were divorced in 2000 and had one minor child, with Mother being the primary residential parent. Father was disabled and had received Social Security Disability Insurance since 1996. As part of Father's SSDI, the child receives a derivative payment, which Mother receives as the primary residential parent. In 2009, the Child's derivative payment was $991.00 per month.
The trial court ordered that Father would be responsible for 70% of uncovered medical expenses, and Mother 30%. Two months later Mother filed for enforcement of uncovered expenses from 2007-2009, seeking a judgment for $6,064.62. At the hearing Father argued that the Court must use the excess above the Guideline calculation towards his share of the uncovered expenses. In 2009 the excess was $415.96 per month, and in 2008 the excess was over $900.00 per month. The Court refused to apply the excess towards uncovered expenses and issued a judgment against Father in the amount of $5,540.06. This judgment was awarded despite Mother's testimony that the SSDI excess covered all uncovered expenses, including her portion. Father appealed.
On appeal, the true question was whether uncovered medical expenses were considered a "child support obligation" which mandated the use of the SSDI towards these expenses. The Court started with the analysis of the definition of "child support obligations" under A.R.S. ? 25-500(9) and found that the statute was unambiguous in its inclusion of uncovered medical expenses as a "child support obligation."
The Court then turned to the language of ? 26 of the Guidelines, which states:
B. Benefits such as Social Security Disability or Insurance, received by a custodial parent on behalf of a child, as a result of contributions made by the parent paying child support shall be credited as follows:
If the amount of the child's benefit for a given month is equal to or greater than the paying parent's child support obligation, then that parent's obligation is satisfied.
Any benefit received by the child for a given month in excess of the child support obligation shall not be treated as an arrearage payment nor as a credit toward future child support payments.
Once uncovered expenses were determined to be a "child support obligation" then under ? 26(B) (1), the SSDI must be utilized. The Court found that the trial court erred is refusing to utilize the excess toward the uncovered expenses. In doing so the Court warned that the excess may not be applied to arrearages, but rather only current uncovered expenses. The specific wording of the holding is important in this situation: To the extent that unreimbursed medical expenses have not become arrearages at the time the SSDI benefit payment is 2 received, we hold that such benefits may be used to satisfy a parent's proportional share of such expenses. ?15
This wording is important as it sets forth the criteria to be examined by the trial court in differentiating between a current expense and an arrearage. As part of the holding, the Court also found that the failure to use the SSDI excess was a detriment to Father and essentially created a windfall for Mother by allowing her to use Father's SSDI contributions for her benefit.
Further the Court found that Mother's position unreasonable and awarded Father his attorney's fees. The Court reasoned that Mother admitted she used the SSDI payment to pay not only Father's portion of uncovered expenses, but her portion as well. Despite Father's attorney appearing pro bono, the Court awarded Father his reasonable attorney's fees.
Generally, an unreimbursed medical payment will become an arrearage if it is not paid within 45 days of a demand for payment. See Guideline 9(A). It is within the trial court's discretion to determine whether the obligation should be treated as an arrearage after considering all relevant factors, including the amount of the obligation, the willingness of the medical provider to accept payments over time, and the good faith of the party in making a timely demand for reimbursement.