LIEN ON ME - CHILD SUPPORT LIENS

Often the topic of daytime talk shows, so-called "deadbeat dads," and an increasing number of moms, fail to provide financial support for their estranged children. In the past, many child support orders simply went unpaid. In response to this problem, states have enacted legislation that makes it easier to collect these unpaid debts. One such enforcement mechanism is the lien. Many states, including Illinois, Indiana, and Wisconsin, now allow the placement of a lien on the real property of child support obligors.

Placement of a Lien

Illinois
A lien arises by operation of law against the real and personal property of the noncustodial parent for each installment of overdue support owed by the noncustodial parent. 750 ILCS 16/20(e). First, however, a transcript or certified copy of the lien must be filed in the Office of the Recorder in the county in which the real estate is located. 735 ILCS 5/12-101. The recorded order for support secures each and every payment, although it may be recorded only once and payments may last 20 years into the future. The State's Attorney may institute an action for child support payments upon the filing of a verified complaint by someone owed child or spousal support. 750 ILCS 16/5.

Indiana
As in Illinois, a delinquent payment under a child support order is treated as a judgment. IC 31-16-16-2. When a court enters an order for support, a lien is created against the real property of the obligor. IC 31-16-16-3. This lien becomes executable in the same manner as other liens in Indiana. To perfect the lien, a person must file a statement or transcript of the support order in the County Clerk's Office for the county where the real estate is located. The clerk must then enter and index the judgment in the judgment docket. IC 33-17-2-3; IC 34-55-9-2; Muniz v United States, 155 NE2d 140, 143 (Ind Ct App 1958).

Wisconsin
In Wisconsin, failure to pay court ordered support becomes a lien in favor of the Department of Workforce Development (DWD) upon all property of the obligor. The lien becomes effective following a two-step process. First, the lien, which reflects the information contained in the court child support order, must be entered into the statewide support lien docket by DWD. The state created the support lien docket to help closing agents and Register of Deeds offices track information on child support liens. The docket must be delivered to the Register of Deeds in the county where the obligor's property is located. The lien filed in the docket secures any unpaid amount of child support at the time of the filing. Wis Stat § 49.854(2).

Priority and Duration of Lien

Illinois
In Illinois, a lien on real property for past-due child support has priority over any subsequently recorded lien, providing notice to subsequent purchasers, assignors, or encumbrancers. 305 ILCS 5/10-25(d). The lien is inferior to the lien for general taxes, special assessments, and special taxes levied by any political subdivision or municipal corporation of the State. 305 ILCS 5/10-25(d). The judgment acts as a lien on real estate for seven years from the time it was entered, unless the judgment is revived before the seven-year period lapses. 305 ILCS 5/12-101(d). The lien secures all past-due installments or payments of child support, but not to the extent that those payments are shown paid by the clerk of the circuit court's records or the records of the state agency receiving payments. Thus, the amount of the lien is determined by the amount of overdue child support payments outstanding at the time of an inquiry.

Indiana
Judgment liens in Indiana have the priority of an unperfected secured creditor in any enforcement proceedings instituted against the property. IC 31-16-16-3. The lien upon real estate lapses after ten years. IC 34-55-9-2. However, Section 1-2, entitled, "Issuance after lapse of ten years" does provide the possibility for the judgment or issue of execution to be issued after ten years. This is available only upon leave of the court and after a ten day personal notice has been sent to the adverse party. The statute does not address whether this option ever expires - apparently that decision is left up to the judge who would be responsible for granting the leave. IC 34-55-1-2.

Wisconsin
Wisconsin liens against property for delinquent support payments have the same priority, from the date that the lien is effective, as a judgment under Section 806.15, but are not effective against a good-faith purchaser of titled personal property, unless the lien is recorded on that title. Wis Stat § 49.854(12)(a); Wis Stat § 49.854(2)(b). In Wisconsin, although judgment liens typically have a ten-year statute of limitations, judgment liens arising from delinquent child support have a five-year statute of limitations. Wis Stat § 49.854(12)(a).

Methods of Enforcing Lien

Illinois
The State holds the lien on all legal and equitable interests of responsible relatives in the amount of past-due child support. 305 ILCS 5/10-25(a). The State's lien is enforceable upon the recording or filling of a notice of lien in the recorder's office of the county or counties in which the real estate is located. 305 ILCS 5/10-25(d). The State may foreclose the lien in a judicial proceeding to the same extent and in the same manner as in the enforcement of other liens. 305 ILCS 5/10-25(i). The procedure to levy on a child support judgment is the same as for other judgments, found in the Code of Civil Procedure at 735 ILCS 5/12-115 et seq.

Indiana
If a judgment requires the payment of money, as in the case of a child support order, the judgment may be enforced by execution. IC-55-1-1. When an execution against the property of a person is issued to a sheriff in Indiana, the sheriff conducts a levy sale. First, the sheriff must serve the execution upon the defendant and levy the execution and if the defendant does not pay, the sheriff then sells the property at a levy sale within sixty days. Also, it is not the duty of the sheriff or the appraisers to ascertain the amount of liens and encumbrances against the property, although that information can be provided to the sheriff or the appraisers. The appraisers then appraise the property at fair cash value, exclusive of any known liens or encumbrances. IC 34-55-3-1; IC 34-55-4-5 to 4-8. A property that has been sold subject to a lien gives the purchaser two options: (1) pay the lien to discharge it; or (2) pay the purchase price of the property and then have the property held subject to redemption by the person entitled to that lien. IC 34-55-4-8.

Wisconsin
In Wisconsin, the DWD initiates the levy process because any unpaid child support becomes a lien in favor of the DWD. Wis Stat § 49.854(2)(a). Once a delinquent child support obligation is included in the statewide support lien docket, the DWD provides notice to the obligor that a lien exists with respect to the delinquent support obligation, to which the obligor can either pay the delinquent amount or appeal and challenge the amount owed. Wis Stat § 49.854(3)(a). If the obligor does neither, then the DWD can commence levy procedures. To levy against real property in Wisconsin, the DWD must first provide the obligor and all owners of the real property with a notice of intent to levy. Wis Stat § 49.854(7)(a). After final notice, the DWD may issue an execution on any real property identified in the notice to enforce a lien contained in the statewide support lien docket. Wis Stat § 49.854(7)(e).

Release of Lien

Illinois
A child support lien may be released in Illinois by the following steps. First, the obligor must record a notice of filing and an affidavit stating that all payments have been made. Second, these documents must be recorded with the recorder in the county in which the lien appears on record. Third, proof of service of notice and affidavit upon the obligee must accompany the request for release. If the state or the obligee does not object within 28 days of notice, then the lien is released. 735 ILCS 5/12-101(c).

Indiana
In Indiana, the onus is on the obligee to release the lien. When the obligor pays in full the child support, the obligee must "release, discharge, and satisfy of record" the lien. IC 32-28-1-1. If the obligee fails, neglects, or refuses to release the lien then the obligor, after sending a written demand to the obligee and waiting 15 days, may sue for a penalty against the obligee not to exceed $500 and reasonable attorney's fees. IC 32-28-1-2.

Wisconsin
A child support lien may be extinguished in Wisconsin by payment of the full amount of the lien to the county child support agency. The obligor may request a satisfaction of lien from the county, showing that the debt has been paid in full. Following remittance of the child support money, the satisfaction of lien may be recorded in the office of the Register of Deeds in the county in which the property of the obligor is located. Wis Stat § 49.854(2)(d).

Methods of Paying Support

Illinois
When paying through child support enforcement services, the payment of support is made to the state disbursement unit established under the Illinois Public Aid Code (305 ILCS 5/1-1 et seq.) under these circumstances: (1) the party is receiving child support enforcement services under Article X of the Illinois Public Aid Code; or (2) no party is receiving child support enforcement services, but the payment is made through income withholding. 750 ILC 16/25(b). If the situation is neither of the above, the court can order the obligor to make support payments to the clerk of the court. 750 ILCS 16/25(c). Regardless of any prior orders directing payments elsewhere and at any time, the Department of Public Aid may provide notice to the obligor to make support payments to the state disbursement unit if the party is receiving child support enforcement services under Article X, support payments are made through income withholding, or to make support payments to the state disbursement unit of another state. 750 ILCS 16/25(d).

In addition, after dissolution of marriage, the court can order that maintenance and support payments be made to the clerk of the court (750 ILCS 5/507(a)) or to the state disbursement agency (750 ILCS 5/507.1). However, the court, in its discretion, can also direct payments to made to someone else when circumstances so warrant. 750 ILCS 5/507(a).

Indiana
In Indiana, support payments must be made through the clerk of the circuit court as trustee for remittance to the person entitled to receive payments. IC 31-16-9-1. Similar to Illinois, however, the court, with reasonable grounds to do so, can also provide or approve another method of payment. IC 31-16-9-1.

Wisconsin
In Wisconsin, payments for maintenance, child support, and family support are made to the DWD or its designee for the use of the person for whom the payment has been awarded. Wis Stat §767.29(1)(a).

In addition, as discussed previously, Wisconsin specifically addresses how to make payment for a lien resulting from delinquent child support under Section 49.854(2)(d), which provides that payment of the full amount that is delinquent at the time of payment has to be made to the county child support agency.

Miscellaneous

The type of payment ordered in a judgment is important because it can often determine whether the court will recognize a lien. In Illinois, for example, in a case where the ex-wife was awarded a judgment in a dissolution of marriage order, the court refused to acknowledge a lien on the husband's property based on that judgment because there was no indication that the payment was for child support or maintenance and the court pointed out that the Illinois Marriage and Dissolution Act (750 ILCS 5/507) recognized liens only for past-due maintenance or child support. Saldeen v Hamelberg, 198 Ill App 3d 146, 555 NE2d 743, 144 Ill Dec 384 (4th D 1990). In comparison, a bankruptcy court held that under Illinois law, once the wife obtained an order for withholding of income to secure support payments, the wife had a priority lien on and right to proceeds from sale of husband's business. In re Salway, 126 Bankr 58 (CD Illinois, 1991).

In addressing child support enforcement cases, courts often look to broader policy implications when making decisions and the goal is usually to provide the best reasonable support for children. In addressing adequacy of child support payments, courts generally apply a reasonable standard and each state has various statutes and formulas to calculate what amount will be required. However, courts do show restraint when calculating support. For example, the Illinois appellate court for the fourth district held that child support payments are not intended to be windfalls, but rather adequate support payments for the upbringing of children. In re Marriage of Lee, 246 Ill App 3d 628, 615 NE2d 1314, 186 Ill Dec 257 (4th D 1993). Similarly, the Indiana Court of Appeals has held that the child and [custodial parent] are both assured of regular and minimally adequate support payments, and that the child's needs are met consistently from week to week. In re Marriage of Weiss, 693 NE2d 588 (Ind App Ct 1998).

Courts are also quick to recognize when a party is attempting to reduce their ability to make child support payments. Thus, when a father who had been ordered to make child support payments based on his earnings at his job of 17 years quit his job and requested a decrease in his child support obligation and a release for a lien based on delinquent child support payments, the court refused to recognize his need for the decrease and release even after the father alleged his unemployment was due to a medical condition. The court upheld the lien and amount of obligation because the court believed that the father's voluntary termination of his former job and failure to seek other comparable paying employment, in the absence of a genuine medical condition that would prevent him from being employed, was unreasonable. In re Marriage of Smith, 177 Wis2d 128, 501 NW2d 850 (Wis App Ct 1993).

Conclusion

Many states now allow the placement of liens on the real property of parents who are unwilling or unable to make their child support payments. The placement of such liens has become an effective way to collect on past due support payments. Once these debts are satisfied, however, child support obligors may have these liens removed from their property. The placement, and potential release, of these liens may prove an incentive for child support obligors to pay their debts.

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