Opinion ID: 2394749
Heading Depth: 1
Heading Rank: 1

Heading: Propriety of Filing Support Liens

Text: After the Department determines that a parent owes it a support debt, it is authorized to assert a lien in the amount of the debt against all nonexempt property of the parent. 19 M.R.S.A. § 503 (1981). [1] The lien attaches on the day of filing and may not be released unless the Department or a court so orders. Id. Property that would be exempt from attachment and execution is similarly exempt from lien and foreclosure under the Act. 19 M.R.S.A. § 502(1) (1981). [2] Here, the Superior Court concluded that the Department violated section 502(1) by filing support liens against the Plaintiffs' property without first determining whether some or all of the property was subject to exemption. In the agreed statement of facts the Department conceded that it indeed did not make such a determination before filing certificates of lien. The Commissioner's position is that the filing of a lien does not automatically make the lien attach to specific, and perhaps exempt, assets. It asserts that the Superior Court's injunction would be unduly burdensome in that there would be considerable administrative difficulties associated with making a prefiling determination whether the debtor owns exempt property. The injunction, argues the Commissioner, effectively subordinates the Department to other creditors who could obtain prejudgment attachment. The Plaintiffs, on their part, argue that the Superior Court correctly construed section 502(1). They contend that the filing of a support lien places a severe burden on the debtor parent and would make it nearly impossible for this parent to secure credit. No language in the Act requires the Department to determine preliminarily whether support debtors own exempt property before it files certificates of lien. The procedures to be used by the Department in foreclosing support liens are not set out in the Act but follow general procedures for the foreclosure of other types of liens. 19 M.S.R.A. § 507 (1981). Section 507 provides that the foreclosure of a support lien on real property is thus governed by 10 M.R.S.A. §§ 3251-3269 (1980 & Supp.1985-1986), while the provisions of 10 M.R.S.A. §§ 4001-4012 (1980) govern foreclosure of support liens on personal property. Whether the lien secures real or personal property, the court has discretion to order a sale of the property, even if the property is exempt. 10 M.R.S.A. §§ 3259, 4008 (1981 & Supp.1985-1986). The foreclosure procedures do not require the Department to make a prefiling determination whether a debtor owns exempt property. Such a prefiling determination would be directly contrary to the procedures normally employed in attachment proceedings relating to exempt property. The existence of an exemption does not insulate the debtor from attachment or levy of execution. Layton v. Chase, 82 S.D. 270, 144 N.W.2d 561, 564 (1966). The fact that the debtor's interest in particular property might be equal to or less than the exempt amount does not prevent the filing of a lien or the creation of a security interest, since the determination whether the property qualifies for exemption is usually made when a creditor attempts to attach the property. In re Roberts, 22 B.R. 215 (Bankr.D.Me.1982). Furthermore, if a debtor's interest in real or personal property exceeds the amount of the exemption, all of the encumbered property may be subject to a forced sale, with the debtor receiving an amount equal to the exemption plus any proceeds remaining after creditors have been satisfied. 14 M.R.S.A. § 4424 (Supp. 1985-1986). Other creditors are thus not required to make a prefiling determination whether the property to be secured is exempt from attachment. Requiring the Department to do so would greatly hinder its lawful efforts to secure child support debts and would give all other creditors a distinct advantage. We therefore conclude that the Superior Court erred in requiring the Department to make such prefiling determinations before asserting support liens against these debtors' properties.