96-223
No. 96-223
IN THE SUPREME COURT OF THE STATE OF MONTANA
1996
IN RE THE MATTER OF REID CONNELL,
Petitioner and Appellant,
vs.
STATE OF MONTANA, DEPARTMENT OF
SOCIAL AND REHABILITATION
SERVICES, CHILD SUPPORT
ENFORCEMENT DIVISION,
Respondent.
APPEAL FROM: District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable John S. Henson, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Richard A. Reep, Reep, Spoon & Gordon, Missoula,
Montana
For Respondent:
K. Amy Pfeifer, Department of Public Health and
Human Services, Child Support Enforcement Division,
Helena, Montana
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Submitted on Briefs: August 8, 1996
Decided: January 2, 1997
Filed:
__________________________________________
Clerk
Justice James C. Nelson delivered the Opinion of the Court.
Reid Connell appeals from the opinion and order of the Fourth
Judicial District Court, Missoula County, affirming the decision of
an administrative law judge denying Connellþs motion to dismiss
with prejudice a child support collection action and state tax
offset action filed against him. We reverse and remand.
We restate the issues on appeal as follows:
1. Has Reid Connellþs constitutional right to due process
been violated under the facts of this case?
2. Did the District Court err in affirming the
administrative law judgeþs decision that CSEDþs actions should not
be dismissed under Rule 41(b), M.R.Civ.P., for failure to
prosecute?
FACTUAL AND PROCEDURAL BACKGROUND
Petitioner Reid Connell (Connell) and Norma Schlenvogt
(Schlenvogt) were first married on March 27, 1967. During the
course of their first marriage, three daughters were born in 1967,
1972 and 1974 respectively. Connell and Schlenvogt divorced on
December 24, 1975. They later remarried on June 3, 1977, but a
divorce decree was entered by default on November 14, 1977, in the
Fourth Judicial District Court, Burleigh County, North Dakota.
Pursuant to this 1977 decree, the North Dakota District Court
awarded Schlenvogt custody of the three minor daughters, granted
Connell reasonable visitation rights and ordered Connell to pay
$550.00 per month in child support. After the dissolution,
Schlenvogt remained in North Dakota with the three daughters and
Connell continued living in Missoula, Montana.
For approximately two years, beginning in December 1988,
Schlenvogt and her current husband received public assistance,
including Aid to Families with Dependant Children (AFDC), from the
state of North Dakota. To receive this assistance, Schlenvogt
signed a document assigning her rights to collect child support to
the North Dakota Department of Human Services to begin child
support collection proceedings against Connell.
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After receiving an interstate referral for the enforcement of
child support from the State of North Dakota, Montanaþs Child
Support Enforcement Division (CSED) initiated a collection action
against Connell. In February 1990, CSED served Connell with a
Notice of Intent to Withhold Income alleging that he was delinquent
in the payment of child support for his daughters and thereby began
an income withholding action against him. On June 18, 1990, the
State Auditorþs office sent Connell a notice that his 1990 state
warrant would be offset against the debt he owed CSED. After
deposing Schlenvogt on August 21, 1990, an in-person administrative
hearing was held on both matters February 15, 1991, in Missoula,
Montana.
At the close of the hearing, the hearings officer established
a schedule for the submission of proposed findings of fact,
conclusions of law and order from the parties. Connell submitted
his proposed findings and conclusions on March 21, 1991. However,
despite applying for and receiving several extensions of time, CSED
failed to submit its proposed findings of fact, conclusions of law
and order. Furthermore, the hearings officer failed to enter a
decision.
It was not until almost four years after the February 1991
hearing that a new administrative law judge (ALJ) took any action
to finalize this matter. On December 23, 1994, the ALJ ordered the
parties to appear at a telephone conference for the purpose of
submitting arguments and motions on the preparation of findings of
fact, explaining that the hearings officer who initially heard this
case was not available to prepare Findings of Fact, Conclusions of
Law and Order in this matter because his contract expired July 1,
1992. On January 11, 1995, a telephone conference was convened.
During the conference, both Connell and CSED agreed that the
credibility of the witnesses was material, and, therefore, the
provisions of 2-4-622(1), MCA (1993) (providing options to
parties when a hearings officer is unavailable for decision), did
not apply. Furthermore, Connell refused to waive compliance with
this statute as allowed by 2-4-622(2), MCA (1993). Additionally,
Connell moved for default judgment against CSED in conformity with
his proposed Findings of Fact, Conclusions of Law and Order, or in
the alternative, to dismiss.
On July 28, 1995, following timely submission of briefs, the
ALJ denied Connellþs motions and ordered a rehearing of the matter.
Connell petitioned the Fourth Judicial District Court for judicial
review of the ALJþs order. After accepting Connellþs petition, the
District Court affirmed the ALJþs July 28, 1995 Order. From this
judgment, Connell appeals.
STANDARD OF REVIEW
Our standard of review concerning a district courtþs
conclusions of law is whether the trial judgeþs interpretation of
the law is correct. Steer, Inc. v. Department of Revenue (1990),
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245 Mont. 470, 474-75, 803 P.2d 601, 603. In this case, the
District Court held that, despite a delay of 44 months, dismissal
of CSEDþs income withholding action was not a proper remedy. We
review this conclusion of law to determine whether the District
Court properly interpreted Montanaþs constitutional guarantees to
due process.
DISCUSSION
Has Reid Connellþs constitutional right to due process been
violated under the facts of this case?
We hold that Connellþs right to due process under Montana
Constitution Article II, Section 17, has been violated and reverse
the District Courtþs decision to affirm the ALJþs July 28, 1995
Order. Because this issue is dispositive, we will not address the
second issue raised on appeal.
Connell argues that the District Court erred when it held that
dismissal was not a proper remedy. Connell contends that he has a
protected liberty interest in having a final decision rendered
within the time frames established by the Montana Legislature. He
asserts that when the CSED hearings office failed to render a
decision after almost a four-year period, this lack of action
constituted an unnecessary and unreasonable delay, and, thereby,
violated his right to due process. Connell admits that he received
the requisite notice and a fair hearing, yet, he asserts that he
also has a procedural right to be free from unnecessary delay in
the final adjudication of his child support obligations.
Connell points out that hearings officers are required to take
official notice of federal and state law, pursuant to Rule
46.30.633(1)(a), and (b), ARM, and that specific time frames for
completion of actions are set forth under Rule 46.30.643, ARM.
Specifically, "[i]ncome withholding actions must be completed
within 45 days after service of notice under 45 CFR 303.100." Rule
46.30.643(1), ARM. Furthermore, Connell asserts that hearings
officers must enter a final decision and order within 20 days of
the hearing pursuant to 40-5-226(7), MCA (1989). Connell argues
that CSEDþs hearings office failed to meet each and every one of
these time frames. Therefore, Connell asserts, CSED violated his
right to due process and dismissal of this action is appropriate.
CSED responds that the timetable for informing the obligor of
the hearing decision on a Notice of Intent to Withhold Income is 45
days from the date of service of the notice under 40-5-414(6),
MCA (1989), and that no statutory time limit is set for issuing a
decision concerning the state tax offset notice under 17-4-105,
MCA (1989). CSED attributes the missed 45-day deadline to
Connellþs requests for continuance of the hearing which resulted in
the hearing being held one year after service of notice. CSED
additionally attempts to avoid responsibility for its inaction by
stating:
Once the hearing officer was no longer empowered by the
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CSED to render a decision, the CSED was unsure how to
proceed in the absence of the hearing officer.
Eventually, after reorganization of the CSED Hearings
Office, and the lapse of an additional thirty months, the
new Administrative Law Judge took steps to have the
matter finally determined. . ..
Further, relying on authority from other jurisdictions, CSED
argues that while Rule 46.30.643(1), ARM, and 40-5-414(6), MCA
(1989), respectively require that income withholding actions must
be completed and the obligor notified of the hearing decision
within 45 days after service of notice, these time frames are
merely directory rather than mandatory. Therefore, CSED asserts
that although violation of these time frames subjects CSED to
possible federal audit penalties, it does not form a basis for
dismissal of the action or entry of default against CSED.
We disagree. Whether the specific time frames established for
income withholding actions are directory or mandatory is a question
we find unnecessary to answer in this case and does not affect our
conclusion that CSEDþs failure to render a decision for 44 months
violated Connellþs due process guarantees under the Montana
Constitution. "Administrative agencies are not exempt from the
constitutional restraints of due process requirements." Montana
Power Co. v. Public Service Comm. (1983), 206 Mont. 359, 368, 671
P.2d 604, 609.
Under the protection of due process, people are granted the
opportunity to be heard "at a meaningful time and in a meaningful
manner." Montana Power Co., 671 P.2d at 609 (citing Mathews v.
Eldridge (1976), 424 U.S. 319, 333, 96 S.Ct. 893, 902, 47 L.Ed.2d
18, 32. Indeed, "due process mandates that an administrative
hearing will constitute a fair trial, conducted in accordance with
fundamental principles of fair play and applicable procedural
standards established by law." Precious Metals Assocs. v.
Commodity Futures Trading Comm'n (1st Cir. 1980), 620 F.2d 900, 910
(citation omitted). The Montana Constitution broadly guarantees
that "[n]o person shall be deprived of life, liberty, or property
without due process of law." Art. II, Sec. 17, Mont. Const.
Moreover, Connell is guaranteed that "justice shall be administered
without . . . delay." Art II, Sec. 16, Mont. Const.
In addition to the constitutional guarantees for prompt
disposition of administrative actions, Montana statutes and
administrative rules set forth specific time frames for expedited
administrative income withholding actions. CSED initiated an
income withholding action against Connell pursuant to the
provisions of Montanaþs Child Support Enforcement Act, 40-5-401,
et seq., MCA (1989). Rule 46.30.643(1), ARM, requires that income
withholding actions must be completed within 45 days after service
of notice and 40-5-414(6), MCA (1989), requires that the obligor
be informed of the hearing decision within the same time frame.
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The purpose of the Child Support Enforcement Act is "to provide a
more effective and efficient way to guarantee the support of
dependent children . . .." Section 40-5-402, MCA (1989). This
stated purpose comports with the federal regulation calling for
expedited administrative or judicial processes that increase the
effectiveness and meet specified processing times concerning income
withholding actions. 45 C.F.R. 303.101 (1989).
CSED not only missed all legally imposed time frames for
completion of this action, but it also blatantly violated all
notions of procedural fairness by failing to act for a period of 44
months after the expiration of the deadline for submitting proposed
findings of fact and conclusions of law. Moreover, CSEDþs
statement that it was "unsure how to proceed" once the original
hearings officerþs contract expired is shocking, to say the least.
Having missed every deadline imposed upon it by law and by its own
hearings officer, CSEDþs attempt to justify its failure to do
anything because it was not sure what it should do borders on the
absurd. Litigants appearing before our State agencies in
proceedings where their property, benefits or rights are at stake
deserve better treatment than being forced to twist slowly in the
breeze because the agency not only fails to timely complete a
proceeding it commenced, but, worse, is apparently not even sure
how to go about doing so. Consequently, we conclude that CSEDþs
unreasonable delay in resolving this case, in light of the various
time frames discussed above, violated Connellþs right to due
process guaranteed by Montana Constitution Article II, Section 17.
Montanaþs constitutional guarantee of justice without delay set
forth at Article II, Section 16 adds further support to our
conclusion on the facts here.
Only once before have we dealt with a similarly long period of
inaction on the part of a state agency. See Klundt v. State, ex
rel., Bd. of Personnel Appeals (1986), 219 Mont. 347, 712 P.2d 776.
While neither party in this action cited Klundt in their briefs, we
believe that it is appropriate that we acknowledge the case, in any
event. In Klundt, a worker alleged that, due to a 37-month delay,
the Board of Personnel Appeals (Board) denied him a timely hearing
and thereby violated his due process rights. We affirmed the
District Court order granting the Boardþs motion to dismiss. We
stated that, in Montana, due process requires notice and an
opportunity to be heard. Klundt, 712 P.2d at 779. Without any
further analysis, we concluded:
In this case, the Board fulfilled the fundamental
requirements of due process. Klundt received notice and
was given an opportunity to be heard. The three-year
delay is disturbing, but not fatal.
Klundt, 712 P.2d at 779.
The facts in Klundt potentially explained the Boardþs delay in
conducting a hearing by indicating that the Board put the matter on
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hold in response to a request from Klundtþs union allegedly
instigated by Klundt himself. Additionally, Klundt did not argue
that any specific time frames were violated, but only that this
particular delay was too long. In this case, CSED only explains
that the hearings office failed to render a decision within
established time frames due to CSEDþs uncertainty and resulting
inaction.
It appears that Klundt was decided on its facts and does not
establish precedent one way or the other as far as the instant case
is concerned. Here, the income withholding action filed against
Connell by CSED was not timely completed because of the lack of
diligence and inaction of the responsible agency. CSED failed to
act within the time frames established by law, by administrative
rule, and by the hearings officer. Connell did nothing that would
justify the unreasonable delay at issue here--a delay which we
conclude is more than simply "disturbing."
In sum, failure on the part of CSEDþs hearings office to
render a decision after a lapse of 44 months constitutes undue
delay under Montana Constitution Article II, Section 16, and
violates the due process guarantees under Montana Constitution
Article II, Section 17. CSEDþs violation of Connellþs due process
rights compels dismissal. Therefore, based on the facts of this
case, we hold that the District Court erred in affirming the ALJþs
July 28, 1995 Order denying Connellþs motion to dismiss and setting
a rehearing date. Accordingly, we hereby remand for entry of an
order dismissing with prejudice both CSEDþs income withholding
action against Connell and CSEDþs proposed tax offset action
against Connellþs 1990 state warrant.
Reversed and remanded.
/S/ JAMES C. NELSON
We Concur:
/S/ J. A. TURNAGE
/S/ KARLA M. GRAY
/S/ CHARLES E. ERDMANN
/S/ WILLIAM E. HUNT, SR.
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