Summary of February 2017 Supreme Court Decisions

Appellate decisions within two weeks of 2/28/17:

Washington State Supreme Court Decisions:

  • In re Marriage of Zandi, 92296-9 (unanimous opinion)- Court held that out-of-network expenses are uninsured medical expenses and must be paid according to the parties’ child support order.
  • “The legislature defines ‘” [u]ninsured medical expenses”‘ as costs “not covered” by insurance. RCW 26.18.170(18)(d). WAC 388-14A-1020 clarifies that this includes costs “not paid” by insurance, even if those costs would be covered under other circumstances. Because the health care expenses in this case are unambiguously within the scope of RCW 26.18.170(18)(d), financial responsibility is allocated by the 2009 order and may not be modified absent evidence of changed circumstances or other evidence consistent with the requirements of RCW 26.09.170(6)-(7).”

    • In this case, it didn’t matter that the father had requested the mother get pre-approval from the insurance company, the mother thought that the issue was urgent enough to require immediate attention. Nothing in the record indicated that the mother acted in bad faith (she did request pre-approval and was assured by hospital staff it would be approved). The court said that to look at the fact that the father did not have a say in the incurrence of the out-of-network expense, “incorrectly introduces concepts of marital fault into the enforcement of a child support order.”
  •  Estate of Ackerley v. Dep’t of Revenue, 92791-0 , (5-4 opinion, Madison authored majority, Wiggins authored the dissent). This is a case concerning the Estate and Transfer Tax Act, chapter 83.100 RCW. There is something called the “gross-up rule” wherein the federal government assesses estate taxes on gift taxes paid within three years of death. The question was whether they also needed to be included as a part of the Washington taxable estate (this would result in more taxes being owed to the state). The majority said yes. The court held:
    • “Following the legislature’s clear mandate, we must also find that the gift tax paid is part of the Washington taxable estate and transferred upon death as part of the entire estate. Thus, the Washington State Department of Revenue (DOR) properly included the gift tax paid in its assessment of Barry Ackerley’s estate.”

    • The focus of the majority is on the concept of “transfer.”
    • The dissent argued that, “[w]here no transfer exists, Washington’s Constitution prohibits the imposition of an excise tax.” In this case, the federal gift taxes were fully and finally paid during life, so no transfer of gift occurred at death. This would mean exclusion of the gift tax from Washington’s estate tax. This focus of the dissent is on the concept of “direct tax:”
    • “Because the estate tax is imposed on a “transfer of property,” it is an excise tax, not a direct tax. And because the tax is not a direct tax, it is not subject to the uniformity requirement of the Washington Constitution.”

 

  • In re Disciplinary Proceeding Against Conteh, 201,448-8  (unanimous opinion – Madsen author). This case involves the suspension of an attorney and whether the Disciplinary Board should have reviewed the case on its own, even when the attorney did not appeal the suspension. The disciplined attorney appealed the decision of the Disciplinary Board not to review the suspension. The court noted that the attorney did not identify any specific assignments of error or any findings he disagreed with. Since unchallenged facts are assumed to be true on appeal, the attorney had no basis for his appeal.

 

  • Lundgren v. Upper Skagit Indian Tribe, 91622-5 (5-4 opinion – Johnson authored majority, Stephens authored dissent). This case involves a property dispute involving land that was purchased by a tribe and where there had been a long-term fence that was inconsistent with documented boundary lines.
    • Majority Opinion: There were issues of sovereign immunity because of the tribal ownership of the land. The issue involved In Rem jurisdiction and the right of Washington Courts to decide actions regarding property. The majority discussed CR 19 and whether the tribe was a necessary party and determined because the Lundgren’s obtained possession long before the Tribe acquired the disputed property, the Tribe was not a necessary party and therefore there was no concern regarding sovereign immunity. The majority also noted that there would be no other remedy without suit in Washington Superior Court.
    • Dissent: The dissent’s argument is captured succinctly with this quote:

      “While the existence of in rem jurisdiction gives a court authority to quiet title to real property without obtaining personal jurisdiction over affected parties, Civil Rule (CR) 19 counsels against exercising this authority in the face of a valid assertion of sovereign immunity. Proceeding without regard to the Tribe’s defense, the majority gives “insufficient weight” to the sovereign status of the Tribe and erroneously “reach[es] and discount[s] the merits of [the Tribe’s] claims.”

 

  • Peralta v. State, 92675-1  (Unanimous Opinion – Wiggins author). This case involved an admission during pretrial discovery (discovery is where both sides ask questions and provide documents relevant to the case). There is a part of discovery where you can be asked to admit or deny certain facts. This case involved an issue where a woman was hit while walking while intoxicated. She admitted in discovery that she was intoxicated and didn’t attempt to qualify it, like she had a drink, but didn’t think she was impaired. The trial court allowed the admission and required her to be bound by it, including it in a jury instruction. The jury found that Peralta’s intoxication was more than 50% of the reason why Peralta was hit. The Supreme Court upheld the trial court’s decision because the intoxication defense statute provides a complete defense to an action for personal injury when the person injured “was under the influence of intoxicating liquor” at the time of the injury.
  • State v. Arlene’s Flowers, Inc., 91615-2 (Unanimous Opinion –  McCloud author). This case involved the violation of the Washington Law Against Discrimination (WLAD) and the Consumer Protection Act (CPA) by a florist seeking to deny services for a same-sex wedding. I hope to blog about this case in more detail soon, but in the meantime, here are the basics.
    •  The court upheld the WLAD and the CPA and rejected the attempt to create an exception based on religious belief. The court held that the refusal to provide flowers was discrimination based on sexual orientation, rejecting the argument that it was marital status discrimination (and therefor permissible).
      • The florist attempted to argue (1) that it was marital status discrimination, not sexual orientation discrimination (and therefore okay for her to refuse services), (2) the WLAD already an express exemption to RCW 49.60.215 for “religious organization[s]” that object to providing public accommodations for same-sex weddings, thus the attempt to argue that WLAD didn’t cover marriages in secular public accommodations failed. The court also rejected the argument that the WLAD requires a balancing test between the rights of the protected class members (i.e., the public using the accommodation) and the business providing the service and the religious beliefs possibly held by the owner of the company.
      • The court also rejected the claim that the WLAD violated her right to Free Speech or Religious Exercise. The court held that the “WLAD is a neutral, generally applicable law subject to rational basis review.  And the WLAD clearly meets that standard: it is rationally related to the government’s legitimate interest in ensuring equal access to public accommodations.” (Citations omitted)

      • The court also noted that the WLAD withstands strict scrutiny review – rejecting the florist’s argument that the couple suffered no real harm:
        • We emphatically reject [the argument the couple suffered no real harm.] We agree with Ingersoll and Freed that “[t]his case is no more about access to flowers than civil rights cases in the 1960s were about access to sandwiches.” Br. of Resp’ts Ingersoll and Freed at 32. As every other court to address the question has concluded, public accommodations laws do not simply guarantee access to goods or services. Instead, they serve a broader societal purpose: eradicating barriers to the equal treatment of all citizens in the commercial marketplace. Were we to carve out a patchwork of exceptions for ostensibly justified discrimination, that purpose would be fatally undermined.

      • Finding that Supreme Court has never held that a commercial enterprise, open to the general public, is an ‘”expressive association'” for purposes of First Amendment protections, the court rejected the florist’s Free Association claim.

Family Law – Post-Secondary Support Case

Anne Sprute (Bradley), Respondent V. Eric Bradley, Appellant, 45608-7, Division II, March 10, 2015 (Published in Part)

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Post-secondary Support:

Couple divorced in 2003 and amended their child support order in 2011 to read  reserved post-secondary support.

Holdings:

(1) Sprute was not required to file her child support worksheets with her request for postsecondary educational support in order to timely request such support;

(2) Sprute’s GI bill benefits could only be applied to reduce her own postsecondary educational obligations under 38 USC § 3319(f)(3)

(3) the trial court did not abuse its discretion by failing to cap postsecondary educational support at the amount charged by UW, and

(4) the trial court erred by using the one-child column to calculate child support for the parties’ minor child because the parties were supporting two children.

 

May 2013, Sprute filed a petition to amend child support, requesting postsecondary educational support for the oldest child.  The initial petition did not include proposed child support worksheets and the court found rejected Bradley’s claim that since the child had graduated by the time the worksheets were filed that the petition for postsecondary support was untimely.

 

Court’s Analysis

(1) Worksheets do not need to be filed to in order to preserve filing date

Statute at issue – RCW 26.09. 175 ( 1), which states that a proceeding for the modification of a child support order ” shall commence with the filing of a petition and worksheets.”

Finding- Sprute exercised her right to request postsecondary educational support by filing her petition to modify for two reasons: language in CSO was that party had to exercise a right, not commence a proceeding and filing a petition to modify exercises that right and a petition to modify without worksheets is sufficient. (2) Following In re Marriage of Pollard, 99 Wn. App. 48, 55-56 (2000), effective date is the date filed, even if worksheets not filed for a year.

 

(2) Cannot Provide a Credit for Post 9/11 GI Bill Benefits 

Overall question – is providing a credit for the GI Bill an impermissible division of benefits under 38 U.S.S § 3319(f)(3)?

The Post 9/11 GI Bill allows a recipient to transfer a certain number of months to her children and it’s not allowed to be considered an asset in marital distribution. Court distinguishes from In re Marriage of Boisn, 87 Wn. App. 912, 943 .2d 682 (1997), which held that if a third party paid, then a parent wasn’t required to reimburse the other parent. Here the court found that there was no “third party” paying for college because the GI Bill belongs to Sprute.

 

(3) No Cap for Postsecondary Education Expenses

The court noted that Bradley did not reference RCW 26.19.009(2) and the non-exhaustive factors. Instead, Bradley argues that it is not fair to make him pay for the most expensive college alternative, and that he does not have sufficient income to pay the award. The court said that the parents’ current and future resources is only one of several factors the trial court can consider.

Bradley did cite In re Marriage of Shellenberger, 80 Wn. App. 71, 906 P.2d 968 (1995) in support for the argument he cannot afford to pay the award. The court found that Bradley produced no evidence that paying the child’s postsecondary support would burden him to the point of filing for bankruptcy.

The court also rejects Bradley’s argument that postsecondary educational support generally must be limited to the cost of public school based on Shellenberger and In re Marriage of Sterns, 57 Wn. App. 707, 789 P.2d 807 (1990).  In this case, the court found that the trial court made specific findings justifying Joshua’s selection of an out-of-state school, that the parties had a history of sending their children to private schools.

(4) Must use the column for support based on the total number of children receiving support. 

The court held that post-secondary support is support and so the support for the minor child should be reduced by using the column for the number of children for whom support is owed, in this case two children. The Court cites In re Marriage of Daubert, 124 Wn. App. 483, 502-03, 99 P. 3d 401 (2004) and In re Marriage of McCausland, 159 Wn.2d 607, 152 P.3d 1013 (2103).

 

The rest of the opinion was unpublished, but they are interesting issues, so I include a summary of those issues as well.

  1. Discovery Issues – There was a concern about the completeness of the discovery by Sprute. The court found no discovery abuse, but did order certain additional answers and documents. The standard on review is abuse of discretion, decision is based on untenable grounds. In this case the documents provided could answer the questions for which Bradley said he needed additional documents. There was also a question of whether the documents requested could lead to the discovery of admissible evidence regarding Sprute’s net income.

 

  1. 45 Percent Cap on Child Support. RCW 26.19.065(1) provides that child support should be capped at 45% of a parent’s income. Bradley attempted to raise this issue on appeal, but he did not bring and the court declined to address this argument on appeal.

 

  1. Attorney Fees. Court declines both parties’ requests for attorney’s fees. Sprute because RAP 18.1 does not provide an independent basis for the award of fees. Bradley failed to request attorney’s fees in his opening brief, as required by RAP 18.1(b).

 

That concludes the summary of the case. There are several issues at play in this case that would make for an interesting appeal to the State Supreme Court. The issue of post-secondary support is a particularly challenging issue. The cost of a college education has sky-rocketed. With that, the amount that parties end up paying for post-secondary can surpass how much they paid when the child was dependent. It seems to me that there should be a cap on post-secondary support, at minimum the 45% cap should apply, but perhaps no parent should ever pay more post-secondary support than they would pay for a dependent child. Although perhaps this cap has to be created by the legislature.

Joint Custody & Child Support

One of the things that I have seen in the family law context is a parent who has more wealth seeking to have equal/joint custody (called residential time in Washington) in order to reduce the amount they pay in child support. While there are times where a parent really wants equal time with their child, all to often it seems to be solely a ploy for reducing the child support obligation. After orders are entered, the child ends up spending a significant amount of time with the other parent, but the parent with the additional residential time is not receiving additional child support for the additional expense. It has made me suspicious of joint custody arrangements and hopeful that courts will be cautious in granting significant deviations based on shared custody, especially because a parenting plan is difficult to modify, so even if a parent tried to modify based on the practice of not exercising joint custody, it would be difficult (compounded by the probability that as soon as the parent sought to modify, the other parent would then try to exercise joint custody and seek to block the modification).

A recent Division III case that is unpublished (meaning it is not meant to be used as precedence/relied upon for future decisions), addressed the issue of deviating for child support based on equal custody. In In re Marriage of Langford, the trial court did not grant a deviation for additional residential time. The Husband appealed the trial court’s ruling, arguing that the trial court abused its discretion in not granting the deviation for residential time. The appellate court disagreed and upheld the trial court’s order.

The Appellate Court noted that the statue allows that a court may deviate from the standard calculation for the purpose of recognizing increased expenses of the obligor parent when residential time is shared, BUT this deviation cannot leave insufficient funds in the household receiving the support to meet the basic needs of the child.

The attorney for Father argued that court should apply the Arvey formula. The Arvey formula is a formula that is used when parents have split custody (two children and one child resides with each parent). The Court noted that the Washington State Supreme Court has rejected the use of the Arvey formula for equal residential place in shared custody placement in State ex reI. M.M.G. v. Graham, 159 Wn.2d 623,632,152 P.3d 1005 (2007). In that case, the court found that the statute gives trial courts discretion to deviate from the standard calculation and a new formula is not necessary and in fact, thwarts the legislature’s directive that courts consider the actual increase and decrease in expenses brought about by an obligor parent having a significant amount of residential time. Citing: In re Marriage of Schnurman, 178 Wn. App. 634, 636,316 P.3d 514 (2013), review denied, 180 Wn.2d 1010 (2014) and State ex reI. MMG. v. Graham, 123 Wn. App. 931, 939, 99 P.3d 1248 (2004), a.ff’d in part, rev’d in part on other grounds, 159 Wn.2d 623, 152 P.3d 1005, abrogated on other grounds by In re Marriage of McCausland, 159 Wn.2d 607, 152 P.3d 1013 (2007).

The dissenting judge in this case had an interesting point. He argued that historically, the obligor parent is based on whom the child(ren) reside the majority of time and that the majority’s reasoning made the obligor parent, the parent who had the greater income. I disagree with his argument (the majority did not address his argument), because in this case, the parents had equal time. In a situation like this income is essentially the tie-breaker in determining who the obligor parent is and there is no danger that a parent who has the children 70% of the time will suddenly become obligated to pay child support because of a greater income.