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Highsmith v. Department of Public Aid

January 21, 2004

[5] FREDRICK HIGHSMITH, PLAINTIFF-APPELLEE,
v.
THE DEPARTMENT OF PUBLIC AID AND BARRY MARAM, AS DIRECTOR OF THE DEPARTMENT OF PUBLIC AID, DEFENDANTS-APPELLANTS.



[6] Appeal from the Circuit Court of Winnebago County. No. 02-MR-112 Honorable Ronald L. Pirrello, Judge, Presiding.

[7] The opinion of the court was delivered by: Justice Byrne

[8]  Defendants, the Illinois Department of Public Aid (Department) and its Director, Barry Maram, appeal from an adverse judgment of the circuit court of Winnebago County in a proceeding under the Administrative Review Law (735 ILCS 5/3--101 et seq. (West 2000)). The Department had placed a lien on a certain investment account in order to collect past-due child support from Derrick Highsmith, who is the adult son of plaintiff, Fredrick Highsmith. Plaintiff filed a request with the Department for a hearing to establish that the funds in the account belonged to him and not to Derrick. Following the hearing, the Department found that Fredrick had failed to establish his interest in the account and that the Department could enforce its lien on the account for the full amount owed by Derrick. On administrative review, the trial court found that the decision was against the manifest weight of the evidence and reversed the Department's decision. We affirm the trial court's order.

[9]  The underlying administrative hearing occurred in February 2002. Plaintiff offered three exhibits into evidence: (1) a statement from First Union Securities for an account entitled "Investment Account for Derrick L. Highsmith & Fredrick Highsmith[,] Jt Ten," showing a balance of $4,640.06 in cash and money market funds; (2) plaintiff's tax return for 2000 showing that he paid taxes on dividends from the account; and (3) Derrick's 1998 tax return reporting no interest or dividend income.

[10]   Plaintiff testified that he was 60 years old and Derrick was 30 years old. Plaintiff opened the account in 1975 or 1976 with an initial deposit of $1,500. The remaining funds in the account were "[d]ividends and interest reinvestment." Derrick never deposited any money in the account. Plaintiff reported the income from the account on his tax returns; Derrick did not. Plaintiff testified that he set up separate accounts for the education of Derrick and Derrick's brother. According to plaintiff, "Derrick's name was on the account providing that Derrick would go to school and it would be set aside for his education." Plaintiff acknowledged that Derrick had the right to withdraw funds from the account, but added that "he never did, because he never did question me about the account. And he really didn't have anything to do with it, other than I just had his name added onto it."

[11]   The Department concluded that "the documentary evidence [plaintiff] provided does not establish that he is the sole owner of any portion of this account." (Emphasis added.) As noted, the trial court reversed this decision. This appeal followed.

[12]   Under Article X of the Illinois Public Aid Code (Code) (305 ILCS 5/10--1 et seq. (2000)), the Department is authorized to enforce child support obligations owed to persons receiving financial aid under the Code. Section 10--25.5(a) of the Code provides that "[t]he State shall have a lien on all legal and equitable interests of responsible relatives in their personal property, including any account in a financial institution *** in the amount of past-due child support." 305 ILCS 5/10--25.5(a) (West 2000). "Responsible relative" means the parent or spouse of a child under the age of 21. 305 ILCS 5/2--11 (West 2000). Moreover, under applicable definitions, a money market mutual fund is considered an account in a financial institution. See 305 ILCS 5/10--24 (West 2000).

[13]   By rule, the Department has provided a joint owner of personal property upon which a lien has been placed with the right to a hearing to contest the lien. 89 Ill. Adm. Code §104.110 (2002). The applicable rule provides:

[14]   "The burden is on the joint owner to prove his or her share of the personal property or account through the production of documentary evidence. Documentary evidence of the joint owner's share may include, but shall not be limited to, the following:

[15]   1) bank statements;

[16]   2) bank signature cards;

[17]   3) canceled checks or facsimiles of checks deposited into or drawn on the account;

[18]   4) account numbers of accounts being held in financial institutions;

[19]   5) title to the personal property;

[20]   6) loan repayment coupons or other ...


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