STATE OF MINNESOTA
IN COURT OF APPEALS
Rita M. Letsos, petitioner,
Louis J. Letsos,
Filed September 21, 1999
Olmsted County District Court
File No. F892663
Rita M. Letsos, 1107 East 9th Street, Duluth, MN 55805 (pro se respondent)
Raymond F. Schmitz, Olmsted County Attorney, Julie S. Voigt, Assistant County Attorney, Government Center, 151 SE 4th Street, Rochester, MN 55904 (for respondent Olmsted County)
Michael R. Inglimo, P.O. Box 008, Superior, WI 54880 (for appellant)
Considered and decided by Toussaint, Chief Judge, Halbrooks, Judge, and Parker, Judge.[*]
Pursuant to Minn. Stat. § 256.87 (1998), Olmsted County commenced an action for public assistance reimbursement and an ongoing child support order. Appellant Louis J. Letsos challenges the order establishing his reimbursement and ongoing support obligations on the bases that (1) the reimbursement amount exceeded the actual amount disbursed to obligee; (2) the child support obligation ordered by the administrative law judge (ALJ) predated the commencement of the action; (3) the ALJ erred in her calculation of income attributable to appellant; and (4) the ALJ abused her discretion when she declined to order a support obligation from respondent Rita M. Letsos. Because we conclude that the ALJ properly applied the law to the facts of the case and did not abuse her discretion, we affirm.
From June 1, 1997, through September 30, 1997, respondent received public assistance grants, including food stamps and medical assistance on behalf of R.L. From November 1997 through May 1998, respondent used a $19,000 personal injury settlement for living and other expenses. In June 1998, respondent went back on public assistance. At the time of the hearing, she was a full-time college student and worked part time.
On January 29, 1998, respondent Olmsted County brought an action against appellant under Minn. Stat. § 256.87 (1998) seeking public assistance reimbursement and ongoing support. The ALJ issued an order for reimbursement of public assistance and for ongoing support, from which appellant appeals.
Under the reimbursement statute, a parent is liable for the public assistance paid to and on behalf of a child "which the parent has had the ability to pay." Minn. Stat. § 256.87, subd. 1. "[A]bility to pay" is determined under chapter 518 and the child support guidelines. Id.; see Ver Kuilen v. Ver Kuilen, 578 N.W.2d 790, 792 (Minn. App. 1998) (stating ability to pay is determined by applying child support guidelines of Minn. Stat. § 518.551, subd. 5 (1998), to parent's net monthly income). If, when setting a reimbursement amount, the guidelines would require a reimbursement amount exceeding the support obligation recited in a dissolution judgment, the ALJ need not restrict the reimbursement amount to the amount of the obligation in the judgment. See Miller, 446 N.W.2d at 199-200 (holding ALJ erred by setting obligation at stipulated sub-guideline amount plus public assistance amount and remanding for entry of child support order that considered the statutory guidelines). If a county is awarded a reimbursement amount exceeding the public assistance the county actually paid, the difference is remitted to the support recipient. Minn. Stat. § 518.551, subd. 1(b) (1998).
Here, respondent received $1,316 in public assistance between June 1, 1997, and September 30, 1997, and the ALJ set appellant's reimbursement obligation at $3,904 based on what she found appellant was able to pay. This is appropriate under Minn. Stat. § 256.87. It is also consistent with Minnesota's "strong state policy of assuring that children have the adequate and timely economic support of their parents." Schaefer v. Weber, 567 N.W.2d 29, 33 (Minn. 1997); see Tammen v. Tammen, 289 Minn. 28, 30, 182 N.W.2d 840, 842 (1970) (concluding minor children have a basic right to support from their parents). Because the ALJ properly considered the child support guidelines and appellant's ability to pay when setting the reimbursement amount, we conclude the ALJ did not abuse her broad discretion in setting reimbursement in an amount greater than the amount of public assistance paid.
Because this case is a reimbursement proceeding rather than one to modify the dissolution judgment, the retroactivity limitation imposed by Minn. Stat. § 518.64 (1998) is inapplicable. In a reimbursement proceeding, the noncustodial parent's liability for child support "may include up to the two years immediately preceding the commencement of the action." Minn. Stat. § 256.87, subd. 5. Because the period from October 1, 1997 to January 31, 1998, falls within the statutory two-year window, we conclude that the ALJ did not abuse her discretion in awarding ongoing child support for that period.
Acknowledging that the calculation is inexact "[b]ecause of the nature of [appellant's] employment and ownership of three restaurants," the ALJ nonetheless was able to calculate income based on employment income and corporate income for 1997. Because the ALJ found that appellant no longer received income from Zorba's, the ALJ excluded this restaurant from the calculation. The ALJ correctly imputed corporate income from Louis Café and Akropolis to appellant as the corporations' sole shareholder. See id. (reversing for failure to include corporate profits in the income of sole shareholder). The ALJ did not consider other personal benefits and expenses paid by the corporations, which she could have imputed to appellant's income. See id. (remanding the case for a determination of the personal expenses paid for by the corporation). The ALJ's calculation is reasonably based in fact; hence, we conclude that she did not abuse her discretion in calculating appellant's income.
Appellant further argues that the ALJ should have imputed income to respondent pursuant to Minn. Stat. § 518.551, subd. 5b(d), because she was voluntarily unemployed. But a party is not voluntarily unemployed or underemployed if the unemployment or underemployment is temporary and will ultimately lead to increased income. Id. Here, respondent testified that she returned to school to increase her income potential. The record supports both the ALJ's refusal to find respondent voluntarily unemployed or underemployed and her finding that respondent was unable to contribute to the support of J.L. Therefore, the ALJ's refusal to order respondent to contribute to the support of J.L. does not go against logic and the facts on record. Accordingly, we conclude that the ALJ did not abuse her discretion in declining to order a child support contribution from respondent.
[*] Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.