Lead Opinion
¶ 1. Father appeals an order of the superior court’s family division upholding the magistrate’s denial of his motion to modify his child support obligation. In particular, father argues that the magistrate erred in declining to impute income to mother, and that the magistrate failed to properly apply a credit in his favor to account for derivative benefits paid directly to mother on behalf of the minor child by the Social Security Administration on account of father’s disability. We reverse.
¶ 2. Father and mother are the parents of a minor child born in January 2000. In 2006, by stipulation of the parties in this parentage action, the family court assigned physical rights and responsibilities to
¶ 3. In November 2008, because father wаs unable to work due to severe injuries he suffered in a motor vehicle accident, the family court issued a modified child support order that did not require either party to pay child support. The order reflected that upon father’s return to full-time employment, child support payments, calculated pursuant to the guidelines, would resume. The parties remained obligated pursuant to that order to split unreimbursed health-related expenses equally.
¶ 4. In December 2010, father filed a pro se motion to modify child support by establishing an order requiring mother to pay him child support. Father represented that he had begun receiving Social Security Disability (SSDI) benefits, and that the minor child had begun receiving derivative benefits on account of father’s disability. In his motion, father raised three issues. First, he represented that the Social Security Administration (SSA) was sending the $190/month derivative benefit for the minor child directly to mother, and he essentially argued that he should receive some benefit in the determination of his child support obligation on account of that payment. Second, he explained that the SSA mailed the initial derivative benefit check for the minor child, which included accumulated benefits in the amount of $4370, to mother; he argued that this lump sum payment should be credited toward his share of the $5780 uninsured dental bill for the minor child’s braces. Third, he asked the magistrate to take mother’s voluntary underemployment into account in fashioning a new child support order.
¶ 5. In a March 2011 order, the magistrate denied father’s motion. With respect to the monthly child support obligation, the magistrate made the following relevant findings: (1) The parties shared physical rights and responsibilities for the minor child based upon an approximate overnight schedule of fifty-three percent with mother and forty-seven percent with father;
¶ 6. The magistrate did not impute additional income to mother, and did not make any findings relating to this determination.
¶ 7. The magistrate noted that father operated a business that had generated more than $50,000 in gross receipts in 2008 and 2009, but with respect to which father’s tax return showed a net loss in each year. The court stated that it assumed that fаther did not continue to operate that business without some financial benefit, despite the losses reflected on paper, but did not make any finding that the business generated income to father, and did not impute any additional income to father on account of this business.
¶ 8. Recognizing that the court was powerless to order SSA to divide the derivative benefit between the parents or send it to father rather than mother, the magistrate explained that this Court’s decision in Cantin v. Young,
¶ 9. With respect to the lump sum accumulated derivative benefit of $4370 that had been paid directly to mother, the magistrate declined to credit father for that sum, explaining that mother’s receipt of the lump sum did not alter the parties’ rеspective obligations to pay half the cost of uninsured medical and dental costs.
¶ 10. Father appealed to the family division, which upheld the magistrate’s decision. Concerning father’s request that the magistrate impute income to mother on account of voluntary underemployment, the family division noted that imputation of additional income would only be appropriate if the magistrate found that mother, who testified that she had been laid off and was looking for work, was voluntarily underemployed. Reviewing the record, the family division affirmed that the magistrate did not err in failing to make such a finding.
¶ 11. With respect to the SSDI derivative benefit, the family division stated, “The court has been unable to find any case law from other states authorizing a trial court to divide among parents the monthly SSA derivative benefits received by the custodial parent.” Accordingly, the family division affirmed on this point. Likewise, the family division concluded that the magistrate’s order denying father’s request to split the lump sum arrearage payment was not erroneous. Father timely appealed.
I.
¶ 12. Before considering the magistrate’s calculation of ongoing child support in light of the derivative benefit, we address the dissent’s suggestion that this issue is not before this Court because it was not raised below. Post, ¶¶ 44-53. The magistrate’s decision reflects that father,
¶ 13. The dissent also contends that the magistrate’s order and the superior court’s affirmance were predicated on a “deviation” from the child support guidelines, presumably pursuant to 15 V.S.A. § 659, such that the underlying child-support-guidelines calculation is irrelevant. Post, ¶¶ 45-51. The suggestion that even if the magistrate’s initial guidelines calculation was substantially wrong, its purported decision to deviate insulates that calculation from review is puzzling. The guidelines calculation is presumed to reflect the amount of child support needed, 15 V.S.A. §§ 655, 659(a), and is unquestionably an important factor in the overall child support order even in the case of an order deviating from the guidelines. See id. § 659(a) (deviation reflects adjustment of child support from guidelines amount). It is not a bursting bubble that ceases to have significance once a court deviates. If the magistrate had issued a new child support order in this case, and its findings reflected that it had done so bеlieving itself to be deviating by $26 per month from the presumptively appropriate level of support calculated pursuant to the guidelines, the fact that the magistrate deviated from the guidelines would not preclude us from reviewing a substantial legal error in its underlying guidelines calculation.
¶ 14. In any event, the dissent’s argument misapprehends the record, as well as the procedural posture of the magistrate’s order. The magistrate did not enter a new child support order — with or without
¶ 15. If the argument is that the court’s decision to deny father’s request to modify the existing child support order was based on the magistrate’s determination that any new child support order would reflect a deviation from the guidelines calculation to a zero-support order, this theory finds scant support in the record. The term “deviation” does not appear anywhere in the magistrate’s decision or in the superior court’s six-page opinion on appeal. The superior court accurately describes that the magistrate “found that the guideline would result in a ‘nominal’ obligation from father to mother after including the derivative benefit, and therefore concluded the zero support order should remain in place.” Accordingly, the superior court reviewed and reaffirmed the application of Cantin to the child-support-guidelines calculation performed by the magistrate.
¶ 16. The dissent suggests that because the magistrate did not issue an order for the guidelines amount — albeit nominal given the way the magistrate did the calculation — its child support order must have reflected a deviation. But the magistrate did not issue a child support order at all; it denied father’s motion to modify. See 15 Y.S.A. § 660(a)(1) (child support order may be modified upon showing of real, substantial and unanticipated change of circumstances). Had the magistrate intended to issue a child support order reflecting a deviation, it would have issued a child support order reflecting the guidelines calculation and the court’s decision to deviate. Having concluded that the guidelines calculation would require only nominal support from father to mother, the magistrate denied the motion to modify outright.
¶ 17. Moreover, the opinions below do not contain any of the hallmarks of a deviation analysis.
¶ 18. In fact, the record reflects that the trial court expressly deferred mother’s' request to present evidence in support of a deviation. At the end of the hearing before the magistrate, in the context of a discussion with counsel in which all present recognized that they did not yet know who would be the obligor under a guidelines calculation, and in response to mother’s request to present evidence supporting a deviation in the event that mother was determined to be the obligor, the magistrate stated: “[I]f the court decides that there should be some child support obligation at least preliminarily owed by
¶ 19. Accordingly, we consider the guidelines analysis upon which the magistrate’s denial of father’s motion to modify rested. The magistrate correctly recognized that our opinion in Cantin establishes the framework for calculating child support in cases in which a child is receiving SSDI derivative benefits on account of a parent. In that case, a noncustodial father received SSDI benefits, and the minor children received derivative benefits on his account. We endorsed a two-step process for taking the derivative benefit into account in the child-support-guidelines calculation. First, we reviewed the purposes of the child support statute — to “reflect the true costs of raising children and approximate insofar as possible the standard of living the child would have enjoyed had the marriage not been dissolved” — and held that the derivative benefits, although paid to the mother as representative payee, should be counted as part of the father’s gross income in the child support calculation. Cantin,
¶ 20. Second, we reaffirmed our holding in a pre-guidelines decision in which we held that an obligor parent is generally entitled to a credit toward a child support obligation for the disability payments received directly by the children. Id. (citing Davis v. Davis,
¶ 21. Likewise, in Cantin, we specifically noted the logical consistency in treating the derivative payments as both income to the obligor father and as a credit toward his child support obligation.
¶ 22. In light of these decisions, the family division’s conclusion that the magistrate lacked the authority to “split the derivative benefit” misses the central issue. The magistrate recognized that the Vermont courts do not have the authority to order the SSA to divert a portion of the derivative bеnefit to father, but also properly understood that the real question before the court was how to account for the fact of the derivative benefit in the child support calculation — a matter squarely within the court’s authority. The magistrate properly recognized that the framework we endorsed in Cantin applied.
¶ 23. Although the magistrate properly invoked the methodology that we described in Cantin, it did not complete the Cantin analysis. The magistrate conducted the first step of the guidelines analysis properly, imputing the derivative benefit to father and calculating a child support obligation accordingly.
¶ 24. Citing Cantin, mother argues that the court properly stopped after the first step; because the derivative benefit excеeded the monthly child support obligation from father to mother, she argues, the court properly reduced father’s child support obligation to $0 rather than ordering mother to pay father back the excess. Mother’s argument fundamentally misapprehends the distinction between child support calculations pursuant to the shared and sole custody guidelines.
¶ 26. The structure of the shared custody guidelines calculation, which applies when each parent exercises physical custody for thirty percent or more of a calendar year, is completely different. First, in contrast to the sole custody guidelines calculation, which is designed to ensure that the custodial parent receives ample support to maintain the requisite standard of living for the minor children, the shared custody guidelines calculation concerns itself with maintaining two households, without distinction between custodial and noncustodial. 15 V.S.A. § 657(a) (total support obligation that forms basis for calculation of child support obligation is increased by fifty percent “to reflect the additional costs of maintaining two households”).
¶ 27. This distinction is critical. The sole custody guidelines are premised on the assumption that the only parent maintaining a household for and meeting the child’s neеds is the custodial parent, so that the noncustodial parent meets his or her obligation of support for the child by making support payments to the custodial parent. In a shared-custody-child-support environment, both parents are presumed to be maintaining households and providing support for the child; neither is the presumed exclusive conduit for support to and for the child. As a consequence, in contrast to the sole custody guidelines calculation, the shared custody guidelines calculation makes no assumption concerning which parent is the obligor and which is the obligee. Instead,
[e]ach parental support obligation shall be determined by dividing the total support obligation between the parents in proportion to their respective available incomes and in proportion to the amount of time each parent exercises physical custody. The parental support obligations shall then be offset, with the parent owing the larger amount being required to pay the difference between the two amounts to the other parent.
Id. (emphasis added). Pursuant to the shared custody guidelines calculation, the parent with whom the child spends more nights may well have an obligation to pay child support to the parent with whom the child spends fewer nights; in a situation in which a child is spending close to fifty percent of thе time with each parent, and
¶ 28. We agree with mother and the dissent that if child support were calculated on a sole custody guidelines basis in this case, as it was in Cantin, the magistrate would not require the custodial parent to pay the noncustodial parent child support, notwithstanding a derivative benefit in excess of the noncustodial parent’s child support obligation. See Louko,
— the child is entitled to the gratuity through the custodial parent. See Keith v. Purvis, 2007-CA-00495-COA, ¶ 12,
¶29. But where child support is calculated pursuant to the shared custody guidelines — undisputedly the proper course here — neither parent is deemed to be “custodial” for the purposes of the basic guidelines calculation, neither is presumed to be the obligor, and both are presumed to require resources for the support of the child. As a consequence, the concept of an “excess benefit” does not apply, and the notion that the parent receiving SSDI benefits would realize an undue financial advantage from a calculation that recognized the payment to the other parent on account of the SSDI benefit parent’s disability makes no sense. The guidelines are equally concerned with both parents’ resources, and the calculation in this case allocates support so that each parent has, at his or her disposal, the resources required to support that child at the prescribed standard of living based on the amount of time the child spends with each parent and the parents’ respective incomes ■ — • including the income imputed to father on account of the derivative benefit. The child support determination here is not about what support father must pay to mother for her support of the child on their collective behalf, or vice versa; it is about whether and how much money is to be transferred from one to the other so that each custodial parent has the resources to support the child at a particular level.
¶ 30. If we do not apply the second step of the Cantin analysis — crediting father for the sums sеnt to mother on his account — mother will receive support for the child well in excess of the payment father would be obligated to pay pursuant to the guidelines, leaving her with more resources than the guidelines calculation envisioned. Father, on the other hand, will be left with (ess money than the shared-custody-guidelines calculation anticipates he will have to meet his own obligation to support the child directly because the guidelines contemplated that he received as income (and could therefore keep) the $190 derivative benefit that was actually sent to mother.
¶ 31. There is no global “windfall” or undue financial advantage to father here; absent the appropriate credit, father will be left with less money to support the child in his household than required by the guidelines, while mother will be left with more. Accordingly, we hold that when a child receives a derivative SSDI benefit on
¶ 32. Finally, the dissent suggests that our approach would forсe mother to turn over the derivative benefit in violation of her fiduciary duty, and potentially in violation of preemptive federal law. Post, ¶¶ 62-69. The dissent’s argument is premised on the notion that we hold that the trial court should direct mother to pay the derivative benefit, or a portion thereof, to father. This framing does not match the reality. We do not purport to direct mother as representative payee to transfer the derivative benefit to father; rather, we consider the implications of the derivative payment on the parties’ respective obligations. See Silver v. Pinskey,
¶ 33. We have previously validated this well-established approach to child support cases involving a derivative SSDI benefit in Cantin,
¶ 34. The
¶ 35. Finally, in Brevard v. Brevard,
¶ 36. Accordingly, in the absence of a deviation from the guidelines calculation, father is entitled to an award of child support in the amount of the credit to him for the derivative benefit payment to mother less his child support obligation pursuant to the guidelines.
II.
¶ 37. Neither the magistrate nor thе family division specifically addressed the proper accounting with respect to the $4370 lump sum derivative benefit arrearage payment to mother on behalf of the minor child. In his motion, father requested that the $4370 sum that had been paid to mother be credited toward father’s fifty percent share of the $5780 orthodontic bill. The magistrate treated father’s request as a motion to modify the medical support order requiring each parent to pay fifty percent of the cost of uninsured health
¶ 38. We recently considered an analogous situation in Louko. In that case, a noncustodial father with a child support arrearage received retroactive SSDI benefits. SSA sent the lump sum arrearage paymеnt for the derivative children’s benefit to mother on behalf of the minor children. Father requested that the payment be treated as a credit toward his child support arrearage; mother objected, arguing that allowing such a credit was tantamount to a retroactive modification of child support. The magistrate and family division disagreed and allowed the credit, and we affirmed.
¶ 39. We explained that the underlying child support order was not modified; rather, the court’s order provided that the derivative benefits constituted payment of the ordered child support amount for the period covered by the benefits. We concluded, “Unless the benefit is credited to the child support arrearage, mother will receive a windfall and the possibility of double payment. The applicable statutes do not address the question of what constitutes payment.” Louko,
¶ 40. Although the character of the support obligation in question in this case is different — father’s obligation is for uninsured health expenses incurred by the child rather than child support arrearages — the rationale underlying our decision in Louko applies with equal force here. Unless the benefit is applied and credited toward father’s child support obligations, including those relating to health expenses, mother will receive a windfall and father will be forced to essentially make a double payment — the $4370 on account of his prior earnings that was sent to mother, and his half of the uninsured medical bills.
¶ 41. This conclusion is consistent with the construct that we adopted in Cantin and reaffirmed in Louko: when an SSDI derivative benefit for a child is payable to a parent other than the disabled parent from whom the payment is derived, we treat the derivative benefit as a payment to the disabled parent, followed by a payment from the disabled parent to the representative payee. Because the obligation in question — half of the minor child’s uninsured medical expenses — is payable to a third party, on remand the magistrate shall ensure that mother applies the lump sum toward father’s share of the dental bill, and that father is credited accordingly.
III.
¶ 42. Finally, father challenges the magistrate’s refusal to impute income to
¶ 43. In this case, mother testified that she was laid off and was looking for work. On this record, the court’s decision not to make a finding that mother was voluntarily underemployed is supported by sufficient evidence in the record.
Reversed and remanded for further proceedings consistent with this opinion.
Notes
As set forth more fully below, for child support purposes, the magistrate properly described the parties as sharing physical rights and responsibilities. See 15 V.S.A. § 657(a) (shared custody calculation applies when “each parent exercises physical custody for 30 percent or more of a calendar year”). With respect to parental rights and responsibilities, mother continued to exercise sole physical rights and responsibilities.
In its opinion, the court at one point stated that the monthly derivativе benefit for the minor child is $195; at another, it uses the $190 figure. A review of the record confirms that $190 is the correct and uneontested amount.
The dissent suggests that we are ignoring a deviation-in-fact due to the magistrate’s failure to say the “magic word.” Our assessment is based on the substance of the magistrate’s statements and actions and is reinforced by the superior court’s clear understanding on appeal that the issue in this case was the application of the child support guidelines and not the propriety of a deviation.
The dissent accurately points out that the magistrate noted from the bench at the close of the hearing that “this sounds like it’s a request for a deviation from the guideline.” Post, ¶ 47. But, as reflected by the magistrate’s written opinion, and consistent with the magistrate’s statement of intent at the end of the hearing, the magistrate did not reach the deviation issue because it denied father’s motion on the basis of its guidelines calculation.
The dissent asserts that the result in Cantin “is not commanded by our child support statute” and argues-that the approach outlined therein affords a financial advantage of some sort to the parent on SSDI. Post, ¶¶ 55-57. It is not clear whether the dissent advocates abrogating Cantin and adopting a different approach. We accept the framework of Cantin as established law and, more importantly, as a well-reasoned methodology for accounting fоr derivative SSDI benefits.
The child-support-calculation worksheet reflects a monthly income for father of $1225, representing $1035 per month in father’s own SSDI benefit and $190 per month on account of the derivative benefit for the minor child.
The magistrate apparently conducted two calculations. The only difference between the two was that one took into account each parent’s two minor dependents in addition to the minor child that is the subject of this action (yielding a monthly child support obligation of $25), and one did not (yielding a monthly child support obligation of $16). The magistrate did not take into account the child support mother received for the benefit of those other two dependent children, but did take into account her unemployment benefits and her bartending wages. Because the magistrate characterized the child support obligation from father to mother as nominal, it did not specify which worksheet formed the basis for its conclusion. Because no party has raised the issue, we do not address the question of whether and how to account for mother’s additional dependents and the child support she receives on account thereof in the child-support-guidelines calculation.
Because the magistrate did two child-support-guidelines calculations and did not identify which one it applied, the imputed overpayment to mother could be either $165 or $174 per month. See supra, ¶ 23 n.7.
The dissent asserts that this decision makes us the first court in the United States to so hold. Post, ¶ 60. The cases and scholarly articles cited by the dissent affirm that when the derivative benefit exceeds the noncustodial parent’s support obligation in a sole custody situation, the custodial parent is not required to pay the excess to the noncustodial parent in the form of support. Post, ¶¶ 57-60. We do not disagree. However, the dissent has not cited a single case in which a court has overridden the results of a stovd-eustody calculation pursuant to the framework we adopted in Cantin because it concluded that the flow of dollars — to rather than from the person to whom the derivative benefit is imputed — was wrong. Accordingly, if we affirmed the magistrate’s approach, we would likewise be the first appellate court in the country to adopt that position. Neither this majority, nor the dissent, has identified any directly on-point cases from other jurisdictions to support our positions. We are in the same boat in that regard.
To the extent that mother is legally accountable as a fiduciary for her management of the derivative-benefit payment, she may or may not identify her support obligation to father, as opposed to her own direct expenditures in support of the child, as the destination of the SSDI bеnefit. Even if she traced her child support payment back to the derivative benefit, we find it hard to imagine that payment of court-ordered child support for the benefit of the minor child would constitute a misuse of the funds or a breach of her fiduciary obligations.
As noted above, at the conclusion of the child support hearing the magistrate specifically stated that if the court concluded that mother owed a child support obligation pursuant to the guidelines calculation, it would then hold a separate hearing to allow mother to present evidence in support of her request for a deviation. In light of our ruling on the guidelines calculation, on remand, the magistrate should complete its consideration of mother’s deviation request before issuing a new child support order. In addition, given the length of time it has taken this Court to resolve this appeal, the magistrate may, upon request of either party, reopen the evidence to consider any changes in circumstances that have occurred pending our decision and may, if warranted by the evidence, fashion an order that reflects varying child support obligations throughout the lengthy duration of this appeal, in addition to a prospective obligation.
Concurrence Opinion
¶ 44. concurring in part and dissenting in part. In this case, the majority reverses and remands the prospective child supрort order for a guideline deviation decision. Although I do not agree with the analysis that reached that conclusion, as discussed below, my first response is that there already was a deviation decision by the magistrate, and father failed to appeal it to the superior court. Thus, there is no valid reason why mother should face another deviation determination. Since this point, fully and clearly demonstrated by the record, should end this appeal without the unnecessary analysis of a complicated legal question, we should dismiss this appeal on that basis. I start with this point.
¶ 45. This child support dispute first went to the magistrate on father’s motion to modify the preexisting order, which was a “zero child support order.” The magistrate made a deviation determination not to change status quo based upon “neither party ha[ving] the current ability to pay child support,” and the record supports the family court’s affirmance of that decision. The magistrate’s decision on whether to modify the on-going child support was stated in ¶ 7 of his order:
Based upon the nominal child support figures produced from the guidelines the court determines the zero child support order should remain in place. While there has been a showing of a change in circumstances neither party has the current ability to pay child support to the other. Mother is the sole supporter of her household. Father has limited income but shares household expenses with his spouse.
Thus, the magistrate made his decision not to modify the existing zero-support order based on ability to pay irrespective of the guideline amount, as noted by the family court in upholding the magistrate’s decision. The issue the majority decides today was not the basis for either the magistrate’s or the superior court’s decision
¶ 46. The majority insists that the magistrate did not make a deviation decision. This position is belied by the provision in the magistrate’s decision quoted above, particularly in light of the transcript of the proceedings before the magistrate. The magistrate must have reached its decision based either on the guidelines, as possibly modified by our decision in Cantin v. Young, or on a deviation from the guidelines — there is no other choice. The magistrate did two alternative guidelines calculations in response to father’s motion to modify and rejected them both. Neither resulted in zero child support, the order the magistrate issued. Under the calculation that took into consideration the parties’ other dependent children, father would have been obligated to pay mother $26.65 per month. The magistrate decided to deviate from that amount and maintain the zero-support order, however, because “neither party has the current ability to pay child support to the other.”
¶ 47. The intention of the magistrate was fully explained on the record at the hearing on father’s motion to modify. At the conclusion of the March 8, 2011 hearing, the magistrate stated that it could “take a look at the various guidelines” but “this sounds like it’s a request for a deviation from the guideline.” The magistrate further explained as follows:
I don’t know that the guidelines fit particularly well with this type of scenario, but I think the best the Court can do is consider the parties’ financial resources and circumstances and the needs of the child, go through the various deviation factors and determine whether or not there should be any child support being paid to one party or the other.
Based on what I’ve heard, my — the Court’s inkling would be no, is that the order at zero probably should remain here. It appears that both parties’ incomes are at a minimal level, and so I don’t see how at this point one party would have the ability to pay support to the other and still maintain the household.
I do not believe it is possible to conclude, based on the oral analysis of the magistrate, that he made a decision based on the guidelines, and not on a deviation from the guidelines. The majority’s statement that it is reviewing “the guidelines analysis upon which the ■ magistrate’s [decision] . . . rested,” ante, ¶ 19, is plainly wrong.
¶48. In the majority’s view, this was not a deviation decision because the magistrate did not use the word “deviаte” in his written order and did not examine the factors contained in 15 V.S.A. § 659. There is no magic in the word “deviate.” The magistrate used the term “deviation” in its oral analysis, and the written rationale for his decision is inconsistent with a guidelines-based determination.
¶ 49. Whether the magistrate specifically itemized the factors for deviation in the statute is beside the point. The issue is not whether the court’s findings were sufficient to support its decision to deviate,
¶ 50. Finally, the majority states that the magistrate did not make a deviation determination because he promised that he would hold a hearing if he were to consider mother’s request to deviate from the guidelines. Again, the record does not support this interpretation of what occurred at the hearing. After the magistrate made the statement quoted above, mother’s attorney stated that if the magistrate “is considering a deviation whereunder my client is at risk of appearing to earn more than [father]” (emphasis added), then mother would want evidence presented on the income provided by father’s wife. The magistrate responded as follows:
Well, the way the Court will leave it is if the Court decides that there should be some child support obligation аt least preliminarily owed by [mother], then the Court will set the matter over for a brief deviation hearing to hear any relevant evidence on that issue. If it does not, then the Court won’t need to hear any additional evidence on the deviation factors.
¶ 51. This statement, in conjunction with previous statements, plainly expresses the magistrate’s intention to deviate from the guidelines and to grant the request of mother’s counsel to take additional evidence on the income of father’s wife only if he preliminarily concludes that mother will have to pay child support to father. The magistrate’s conclusion is hardly surprising since both parents have low incomes of similar amounts and are each supporting two children in addition to the child at issue here.
¶ 52. The majority holds that this Court can still reach the guidelines question even though neither the magistrate nor the superior court made a guidelines determination. The magistrate was concerned that the guidelines do not “fit particularly well with this type of scenario” and found that “both parties’ incomes are at a minimal level” and no “party would have the ability to pay support to the other and still maintain the household.” While the majority may want to address the requirements of the guidelines in shared custody cases involving dependency disability benefits only to return the case for another deviation decision, the process is unfair to mother, who already has an unchallenged deviation decision.
¶ 53. In short, the magistrate has already made a deviation determination, the family division upheld that determination, and father did not challenge that decision here. We should not reach the guidelines issue that the majority resolves this appeal on, and we should not order a do-over deviation decision. This is my first ground of dissent.
¶ 54. Nevertheless, because the majority reaches the merits of the guidelines question, I will address it. In Cantin v. Young,
¶ 55. Today’s result, however, is not commanded by our child support statute because the SSDI benefits paid directly to the child would not be considered income to the parent under the statutory definition. See 15 V.S.A. § 653(5). However derived, the benefits are income to the child rather than to either рarent. See Hennagin v. Cnty. of Yolo,
¶ 56. The general rules in Cantin significantly benefit the parent being credited for the derivative benefit. The financial advantage to the SSDI benefit parent from treating 100% of the amount of the benefit as a child support credit will often far exceed any financial disadvantage that may result by treating that amount as income to the benefit parent. In fact, it is entirely possible that the advantage will be so great that it will eliminate any requirement that the benefit parent pay child support out of his or her direct income. This would be the circumstance in this case if there were not shared custody.
¶ 57. As a limit on this potential advantage, courts around the country have held that while the general rule can reduce a parent’s child support obligation to zero, it cannot create an obligation for the other parent to pay child support to the SSDI benefit parent. See Keith v. Purvis, 2007-CA-00495-COA (¶ 12),
¶ 58. In sum, the vast majority of courts around the country hold that the second step in the Cantin analysis does not permit an excess credit. The few cases to the contrary are based on specific statutory or regulatory language requiring a different result. See, e.g., Davis v. Davis,
¶ 59. The most common rationale for the majority rule is summarized in Keith,
¶ 60. The majority-rule courts have reached their decisions as part of the general rule of how SSDI benefits are used in calculating child support and not as a discretionary case-by-case determination of where the equities lie. See 15 Y.S.A. § 659. As far as I can determine, this decision makes us the first court in the United States to allow the SSDI credit excess to become a child support amount payable to the parent from whom the child’s SSDI allowance is derived withоut a specific statute or rule requiring this result.
¶ 61. The majority justifies its conclusion by relying on the fact that this is a shared custody case. I agree with the majority on how child support is calculated in a shared custody situation and why, but this case is about the allocation of a credit for a SSDI dependency payment directly to the child. The majority rule limits the financial advantage to the SSDI benefit parent irrespective of the custody arrangement. There is nothing special about shared custody for this purpose.
¶ 62. There is another significant reason why I cannot support the majority’s position. Mother’s obligation to pay child support to father derives from the second step in the process — the credit given to father for the dependent SSDI benefit paid directly to the child through mother as representative payee. In essence, mother is receiving the SSDI benefit on behalf of the child and paying it to father rather than to the child. This result undercuts mother’s ability to meet her legal obligations under federal Social Security law.
¶ 63. The SSA provides derivative benefits for dependent children of individuals
¶ 64. A representative payee must account for the use of derivative benefits in written reports submitted at least once a year. 42 U.S.C. § 405(j)(3)(A); 20 C.F.R. §404.2065. The regulations provide that “[a] representative payee who misuses [derivative] benefits is responsible for paying back misused benefits,” 20 C.F.R. § 404.2041(a), thereby “implicitly allowing for a claim by the beneficiary against the payee.” Grace Thru Faith v. Caldwell,
¶ 65. As itemized above, federal law imposes serious legal obligations on representative payees accepting derivative Social Security benefits on behalf of others. Yet, the effect of the majority’s holding is to transfer the bulk of the derivative benefit in this case from mother, the representative payee, to father, who would not assume any of the federally imposed legal obligations placed on representative payees to ensure that the binds are used for the child’s benefit. In this sense, the majority’s holding undercuts mother’s ability to comply with her legal obligations under federal law with respect to the derivative Social Security funds entrusted to her for the benefit of the parties’ child.
¶ 66. In analogous situations, courts in other jurisdictions are divided on whether the doctrine of federal preemption precludes state courts from exercising jurisdiction to direct a representative payee’s disposition of derivative Social Security funds. Compare C.G.A. v. State,
¶ 67. Most of the cases wrestling with whether federal рreemption precludes state court jurisdiction in such situations examine the scope and interaction of 42 U.S.C. § 407(a), which prohibits the attachment of Social Security benefits by any legal process, and 42 U.S.C. § 659(b), which excepts situations where legal process is used to enforce a legal obligation of the person receiving the benefits to provide child support. Those courts finding federal preemption have concluded that a child support order is a legal process and that § 659 does not override § 407 with respect to derivative benefits because the child, the owner of the benefits, does not have a legal obligation to provide child support. See, e.g., C.G.A.,
¶ 68. Whether or not the doctrine of federal preemption applies here is open to debate, but one thing is certain — once the family court crosses the line from offsetting derivative benefits against a child support obligation to requiring the recipient spouse to pay the obligor spouse the amount by which those benefits exceed the support obligation, it undercuts the recipient spouse’s ability to comply with the legal obligations set forth in federal Social Security law by effectively directing the representative payee’s use of those benefits and transferring the benefits to a spouse who has no legal obligation with respect to the funds under federal law. This is another reason why I do not join the majority’s holding that a credit for derivative benefits may extend beyond the amount of the child support obligation.
¶ 69. I do not find it determinative that the majority’s holding does not require the family court in this case either to direct the SSA to transfer part of the derivative benefit to father or to direct mother’s actual use of the monthly derivative benefit check. Money is fungible. By requiring mother to pay father the exact amount by which the monthly derivative benefit check exceeds father’s monthly child support obligation, the majority is effectively directing the use of the derivative funds from the person who has the legal responsibility
¶ 70. Regarding father’s request that mother credit him for his share of the child’s $5780 orthodontic bill out of the $4370 lump-sum derivative benefit she received, I agree with the majority that Louko controls. In Louko, we permitted a credit for child support arrearages accumulated during the time of the disability out of a lump-sum derivative Social Security disability payment.
¶ 71. Accordingly, I agree that father may obtain a credit for his share of the orthodontic expenses out of the lump-sum derivative benefit payment. I also agree with the majority’s conclusion that the record supports the family court’s decision not to find mother voluntarily underemployed.
¶ 72. For the reasons stated above, however, I do not agree that we should reverse the decision of the family court to uphold a zero сhild support determination by the magistrate. The magistrate clearly made a deviation determination, and father failed to properly challenge the grounds for that determination. The family court’s decision should be upheld on that basis.
¶ 73. If we reach the merits of father’s challenge, which I would not do, we should affirm the decision of the family court for the reasons I set forth above. Accordingly, I respectfully dissent from the majority decision.
Neither the magistrate nor the superior court analyzed the issue on which the majority decides this case. At both levels, the court understood father to be arguing that the court should order that part of the dependent Social Security benefits be allocated to father; father’s filings raised the issue in that way. The way that father raised the issue obscured the obvious point that a determination under the guidelines or under Cantin v. Young was irrelevant under the rationale for the magistrate’s decision. I recognize that father was a self-represented litigant and his arguments should be treated with liberality, but I do not believe he properly preserved the issue.
The majority’s statement is not correct. The magistrate never addressed the issue on which the majority renders its decision because, obviously, he did not believe that the issue was in the case before him. Thus, the Court is not reviewing the decision of the magistrate; it is rendering a decision on a ground that the magistrate never knew about.
I note that magistrate proceedings are governed by Vermont Rule for Family Proceedings 8(b), which adopts the procedures in Vermont Rule for Family Proceedings 4, unless there is a specific procedure in Rule 8. In turn, Rule 4(a)(1) adopts the procedures in the Vermont Rules of Civil Procedure, absent a specific, conflicting procedure in that rule. There being no conflicting procedure in either family rule, Vermont Rule of Civil Procedure 52(a)(1) governs the court’s obligation to make findings. In the absence of a specific, timely request to make findings, the magistrate was under no obligation to do so. Id.
I fully support the Cantin rule, but differ with the majority on the elements of the rule. As with any doctrine we adopt based on analyses in other jurisdictions, in Cantin we relied on the part of the doctrine applicable to the case before us. This case involves another aspect of the doctrine.
As the majority notes, we stated in Louko v. McDonald,