Opinion ID: 881949
Heading Depth: 1
Heading Rank: 4

Heading: Social Security Benefits on Behalf of the Children

Text: The District Court in Conclusions 6 and 7 of its November 1, 1990 findings of fact, conclusions of law and order held: 6. That Respondent, Ed Durbin, has paid in full all child support he was obligated to pay through June, 1987, at which time the social security benefits commenced, said benefits being specifically for child support payments from Respondent as the result of his total disability resulting from his injury. 7. That the amounts of those social security payments have been in excess of the amounts due under the Property Division and Custody Agreement of the parties and also exceed the Montana Child Support Guidelines for child support. The Court therefore concludes that the Petitioner is entitled to the child support payments of the social security benefits therefor, paid by the Social Security Administration. Petitioner is not entitled to child support payments from the Respondent in excess of the social security payments therefor until the amounts determined under the Montana Guidelines exceed the social security payments, and then only the excess over such payments. (Emphasis added.) Terri argues that the District Court erred when it concluded that the Social Security benefits she receives on behalf of the children 1) are a credit toward Ed's child support obligation from June 1990, and 2) relieve Ed of paying any back, current and future child support under the dissolution decree. This Court has addressed the issue of whether Social Security benefits on behalf of a child serve as a credit toward a parent's child support obligation on two different occasions. In Tefft v. Tefft (1981), 192 Mont. 456, 457-59, 628 P.2d 1094, 1095, a district court on March 25, 1980, amended a February 27, 1980 dissolution decree by allowing a father to credit the $200 monthly Social Security benefits, received on behalf of his child due to the child's learning disability, toward his $250 child support obligation. The district court, in amending the dissolution decree, considered these Social Security benefits as financial resources of the child under what is now § 40-4-204(2)(a), MCA. Tefft, 192 Mont. at 462-63, 628 P.2d at 1098. This Court affirmed when it found no abuse of discretion on the part of the district court. Tefft, 192 Mont. at 463, 628 P.2d at 1098. In the case of In Re the Marriage of Gallant (1990), 241 Mont. 363, 364-65, 786 P.2d 1193, 1195, an action for past due child support, this Court held that Social Security benefits to a child due to the father's disability did not absolve the father's child support obligation under the dissolution decree. In Gallant, father was disabled at the time of the dissolution. The district court recognized father's disability and allowed him to forego child support until he received disability benefits. Father began to receive Workers' Compensation benefits one year later in 1981. Father, however, did not comply with child support under the dissolution decree. In 1985, father began to receive Social Security benefits for his disability; additionally the children began to receive monthly Social Security benefits, these benefits exceeding the amount of the father's monthly child support obligation. From 1986 to 1990, father failed to pay any child support. Father argued that he was in substantial compliance with his child support obligation under the dissolution decree due to, in part, the monthly Social Security benefits on behalf of the children. Gallant, 241 Mont. at 364, 786 P.2d at 1194. This Court held that [s]uch benefits in no way constitute an expenditure from the father. Gallant, 241 Mont. at 365, 786 P.2d at 1195. Other jurisdictions addressing this issue have held: 1. Social Security benefits received as a result of a parent's retirement or disability are credited toward child support obligations. E.g. Cash v. Cash (1962), 234 Ark. 603, 353 S.W.2d 348; Horton v. Horton (1963), 219 Ga. 177, 132 S.E.2d 200; Schulze v. Jensen (1974), 191 Neb. 253, 214 N.W.2d 591; Perteet v. Sumner (1980), 246 Ga. 182, 269 S.E.2d 453; Boyes v. Boyes (Iowa 1976), 247 N.W.2d 265; Griffin v. Avery (1980), 120 N.H. 783, 424 A.2d 175; Folds v. Lebert (La. App. 1982), 420 So.2d 715. 2. Social Security benefits are credited toward future child support obligations only upon modification of the original decree. E.g. Chase v. Chase (1968), 74 Wash.2d 253, 444 P.2d 145; Joachim v. Joachim (1977), 57 A.D.2d 546, 393 N.Y.S.2d 63; In Re the Marriage of Cope (1980), 49 Or. App. 301, 619 P.2d 883; Moritz v. Moritz (Minn. 1985), 368 N.W.2d 337. 3. Social Security benefits are not credited toward child support obligations when certain circumstances exist. E.g. Fowler v. Fowler (1968), 156 Conn. 569, 244 A.2d 375; Oatley v. Oatley (1977), 57 Ohio App.2d 226, 387 N.E.2d 245; Gerlich v. Gerlich (Minn. 1986), 379 N.W.2d 689; McClaskey v. McClaskey, (Mo. App. 1976), 543 S.W.2d 832; In Re the Marriage of Sward (Minn. 1987), 410 N.W.2d 442. Section 40-4-208(1), MCA, provides that a dissolution decree can be modified only as to installments accruing subsequent to actual notice to the parties of the motion for modification. (Emphasis added.) See also 45 C.F.R. 302.70 and 303.106 (1990). We are therefore persuaded by the second category of cases holding that the receipt of Social Security benefits on behalf of a child and following a dissolution does not justify a credit toward child support obligation absent a court action modifying the dissolution decree. Here, Ed petitioned the District Court for modification of child support on May 29, 1990, following receipt of his $373,557 lump sum settlement. Ed's petition served as actual notice to Terri of Ed's modification request. Under § 40-4-208(1), MCA, any modification of Ed's child support payments under the dissolution decree applies only to the child support payments accruing after May 29, 1990. We hold that based on § 40-4-208(1), MCA, the District Court incorrectly concluded that the Social Security monthly benefits on behalf of the children from June 1987 to May 1990 served as a credit toward Ed's child support obligation; accordingly, Ed is responsible for paying monthly payments of child support under the dissolution decree from June 1987 to May 29, 1990. Still remaining is the issue of whether the Social Security benefits received on behalf of the children after May 29, 1990, serve as a credit toward Ed's child support obligation. These benefits are paid as a result of Ed's disability and serve in part as a substitute for Ed's lost earning capacity. 42 U.S.C. § 402(c). Accordingly, we hold that these Social Security benefits on behalf of the children received after May 29, 1990, are to be treated as a contribution from Ed toward the support of his children and serve as a credit toward Ed's child support obligation. In light of this holding, we overrule Tefft v. Tefft (1981), 192 Mont. 456, 628 P.2d 1094, to the extent of allowing a retroactive credit of Social Security benefits received on behalf of a child toward a parent's child support obligation prior to a modification of the dissolution decree. Additionally, we overrule In Re the Marriage of Gallant (1990), 241 Mont. 363, 786 P.2d 1193, to the extent that Social Security benefits on behalf of a child due to a parent's disability cannot under any circumstances be credited toward the parent's child support obligation.