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COURT OF APPEALS DECISION DATED AND FILED September 10, 2014 Diane M. Fremgen Clerk of Court of Appeals |
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This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
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APPEAL from an order of the circuit court for Sheboygan County: angela w. sutkiewicz, Judge. Affirmed.
¶1 BROWN, C.J.[1] Tulga Ozbaki appeals from a circuit court order finding him in contempt for failure to report substantial changes in his income as required by his divorce judgment and ordering him to purge the contempt by the payment of an amount compensating his ex-wife for the lost opportunity to seek increased child support and for her attorney fees. Ozbaki points out that the divorce judgment failed to inform him, as the statutes mandate, that he and his ex-wife should annually exchange financial information and that he should inform his ex-wife of substantial changes in his income within ten days. See Wis. Stat. §§ 767.27 and 767.263 (2003-04).[2] He claims that he cannot be held in contempt for something he did not know he had to do. We reject that argument. Even though the omission was contrary to the clear import of the statutes, the judgment did order him “to notify the Sheboygan County Clerk of Courts of any change of employer or any change in the amount of income such that his ability to pay child support is affected, within ten (10) days of such change.” Ozbaki was not entitled to sit on his hands and tell no one about his increased income. His responsibility was to let the court know, through the clerk of courts. It is no answer that he claims not to have willfully violated this order. The order was as plain as day. We conclude that the underlying order imposed a clear obligation to inform the court of his changed income, that Ozbaki willfully violated that portion of the order, and that there was no error in the court’s exercise of its discretion in exercising its contempt power here. We affirm.
¶2 Ozbaki and his ex-wife Sylwia Altass divorced in 2001. They are the parents of one child, who was
born in 1999. Ozbaki and Altass were
married in Denmark, and Altass and the child live in Poland. Ozbaki visited Altass and the child in Poland
during the marriage but resides in Sheboygan county, where he filed the divorce
action.
¶3 Child custody and placement issues were resolved by stipulation and order in the Sheboygan County Circuit Court in 2005. That 2005 order directed Ozbaki to pay child support arrears and to pay $700 per month for child support going forward. The order also directed Ozbaki to
notify the Sheboygan County Clerk of Courts of any change of employer or any change in the amount of income such that his ability to pay child support is affected, within ten (10) days of such change pursuant to Wis. Stat. § 767.263.
The record does not contain a
transcript of the hearing at which this stipulation was approved, but the
minutes of the hearing note that Ozbaki was ordered to “notify of change of
employment or wages.”
¶4 In June 2013, Altass filed a motion to review or modify child
support and served Ozbaki with a subpoena demanding copies of his 2011 and 2012
financial records. Ozbaki’s documents
showed that his income was over $116,000
in 2011 and over $112,000 in 2012, almost double his $62,000 base income at the
time of the 2005 stipulation and order. Altass
filed her own financial disclosure on Ozbaki on September 3, 2013.
¶5 On September 4, 2013, Altass served Ozbaki with a request for copies of Ozbaki’s tax returns for 2005-2010. The following week Altass sought an order to show cause for contempt “for failure to timely exchange financial disclosure information under Wisconsin law and that [Ozbaki] pay respondent the difference between” the child support amounts Ozbaki paid and what he would have owed had he disclosed his increased income. In an affidavit supporting the order to show cause for contempt, Altass attached the 2005 order and quoted from Wis. Stat. § 767.54, which provides as follows:
In an action in which the court has ordered a party to pay child … support ..., the court shall require the parties annually to exchange financial information…. A party who fails to furnish information required by the court under this section may be proceeded against for contempt of court under [Wis. Stat.] ch. 785. If the court finds that a party has failed to furnish information required under this section, the court may award to the party bringing the action costs and … reasonable attorney fees.
Sec. 767.54.[3] The hearing on Altass’s motion order to show
cause for contempt was scheduled for Monday, October 7, 2013.
¶6 On October 3, 2013, the Thursday before the contempt hearing,
Ozbaki filed a brief arguing for deviation from the child support guidelines due
to the lower cost of living in Poland.
Ozbaki also responded to the pending document request with an unsigned,
one-page document objecting to the request for documentation of income for the
years 2005-2010 on the grounds that the documents had “no relevance to [the] …
pending child support modification motion.”
¶7 Upon receiving that response, Altass filed a motion for
sanctions for overtrial and for failing to respond to the discovery
request. In that motion, Altass argued
that the requested information was relevant to the pending motion for contempt
and sought both compensatory and punitive damages against Ozbaki, as well as an
order that the tax returns be produced and the contempt hearing rescheduled.
¶8 At the October 7, 2013 hearing, Ozbaki appeared in person and Altass appeared from Poland via Skype. The court expressed concern that the brief filed by Ozbaki on the cost of living issue was untimely. The court further expressed concern with Ozbaki’s “last minute” contention that the 2005-2010 tax returns were not relevant, given the pending contempt motion and the timing of the hearing. Altass argued that under Frisch v. Henrichs, 2007 WI 102, 304 Wis. 2d 1, 736 N.W.2d 85, Ozbaki was in contempt for failing to provide the financial information “therefore depriving [Altass] of the ability to seek modification of child support earlier.” Altass argued that in addition to the contempt, sanctions were appropriate because Ozbaki “had time to file the brief … and … to hire an expert but … hasn’t had the time to properly answer our request for production” of the tax records.
¶9 Ozbaki argued that there were no grounds for the contempt motion because the 2005 order contained no “specific[] order … that says the parties are to give … financial information.” He argued that his response to the request for production of documents was timely and that the 2005 stipulation and order provided no basis for contempt. In particular he argued that he did not “intentionally or willfully” violate the 2005 order because he paid $700 every month as agreed and the order only required him to give notice if there was a change “such that his ability to pay support is affected.”
¶10 The court concluded that the contempt and sanctions hearings would have to be postponed. A new hearing date was set, and Ozbaki was ordered to produce the 2005-2010 tax returns by October 18, 2013.
¶11 At the new hearing, Altass argued that Ozbaki should be ordered to contribute toward her attorney fees as well as pay an amount to compensate her for the lost opportunity of obtaining additional child support that she could have received if Ozbaki had disclosed his increased earnings in the years 2007-2012. Ozbaki repeated his argument that the 2005 order did not direct him to disclose his increased earnings.
¶12 The court determined that Ozbaki’s interpretation of the 2005
stipulation and order “is just not reasonable and … is very self-serving.” Under
the Frisch
case and a reasonable interpretation, the court concluded, it was clear that the
“payor” had “an affirmative duty” to update his income information so that the
custodial parent could seek increased support. Just as in Frisch, the court
observed, the payor’s failure to disclose the financial information “allowed
[him] to evade exposure to the possibility of a modification of his child
support obligation.” The court imposed
on Ozbaki the obligation to pay Altass $27,000 as a condition to purge the
contempt. The court also ordered Ozbaki
to pay the requested attorney fees “due to the problems we had with discovery,”
as an additional purge condition. Ozbaki
appeals from the order finding Ozbaki in contempt and imposing these purge
conditions.
¶13 On appeal Ozbaki argues that the circuit court erred in finding Ozbaki in contempt and imposing purge conditions because “there was no court order requiring [Ozbaki] to provide financial information to [Altass].” Ozbaki also contends that there was no authority to impose remedial contempt because there was insufficient evidence to establish a willful violation of the 2005 order. These arguments raise questions of the circuit court’s authority to employ remedial contempt under particular circumstances, which are questions of law that this court reviews de novo. Frisch, 304 Wis. 2d 1, ¶29.
¶14 In addition, Ozbaki argues that even if remedial contempt was
authorized here, the circuit court erroneously exercised its discretion in
calculating and imposing the particular purge conditions in his case. In reviewing a circuit court’s exercise of
its contempt power, we affirm if “the circuit court logically interpreted the
facts, applied the proper legal standard, and used a demonstrated rational
process to reach a conclusion that a reasonable judge could reach.” Benn v. Benn, 230 Wis. 2d 301, 308,
602 N.W.2d 65 (Ct. App. 1999).
¶15 The record refutes Ozbaki’s first argument, that the contempt
finding was made “in the absence of an underlying court order.” To the contrary, a significant portion of the
testimony at the hearing concerned the language of the 2005 order that
specifically directed Ozbaki to “notify the Sheboygan County Clerk of Courts of
any change … in the amount of income such that his ability to pay child support
is affected within ten days of such change.”
Ozbaki acknowledged that provision of the order and acknowledged his
failure to disclose any change in income over the years despite the fact that
that his income increased by as much as fifty percent in the years after 2005. Ozbaki claimed that he interpreted the
provision as referring to any change in his ability to pay his “current”
support. In response to questioning by the court,
Ozbaki acknowledged that the word “current” did not appear in the
provision.
¶16 In reaching its determination that Ozbaki was in contempt, the
circuit court began by observing that “the father’s interpretation of the
stipulation [from 2005] is just not reasonable and … is very
self-serving.” The court rejected
Ozbaki’s “self-serving” interpretation and found instead that “[a]ccording to
the Frisch
case and a reasonable interpretation,” Ozbaki had an affirmative duty
to report the significant increase in income, so that child support could be
increased to benefit his child. The
specific conduct that the court found contemptuous here was that Ozbaki “was
able to escape exposure to the possibility of his child support being
increased” by failing to update his income as it increased.
¶17 The same portions of the record refute Ozbaki’s second argument, that there was insufficient evidence to support a finding that he willfully violated the 2005 order because it was “ambiguous.” We agree with the circuit court that Ozbaki found ambiguity where there was none. Ozbaki’s interpretation of the relevant provision of the 2005 order was “not reasonable and … very self-serving.”
¶18 With respect to these first two issues, Ozbaki attempts to frame the question as whether the circuit court could find him in contempt for failing to abide by his statutory obligations to exchange financial information annually, Wis. Stat. § 767.27 (2003-04), and update his financial information, Wis. Stat. § 767.263 (2003-04), when the 2005 order failed to set forth those obligations. While it is true that in its written order after the contempt hearing, the court stated that it was finding Ozbaki in contempt for failure to disclose his information on an annual basis and failure to report substantial changes in income to Altass, the written order also incorporates the oral decision by reference. The oral decision makes clear that at least one of the grounds for finding Ozbaki in contempt was his violation of the specific provision of the 2005 order requiring him to update his financial information with the court if his ability to pay child support changed.[4] The court cited Frisch for the proposition that, while a court may not retroactively increase child support, it may formulate an alternative purge condition designed to compensate a child support payee for losses suffered as a result of a payor’s contemptuous failure to update financial information. See Frisch, 304 Wis. 2d 1, ¶78. Since the record supports the court’s conclusion that Ozbaki violated the provision of the 2005 order requiring him to update his financial information with the court if his ability to pay changed, we need not decide whether the statutes provided an independent basis for contempt. Dalka v. Wisconsin Cent., Ltd., 2012 WI App 22, ¶66 n.10, 339 Wis. 2d 361, 811 N.W.2d 834 (noting that this court will decide cases on the narrowest possible grounds).
¶19 Ozbaki’s final argument is that the circuit court’s exercise of its contempt authority was not “the product of a rational mental process by which the facts of record and law relied upon are stated and are considered together for the purpose of achieving a reasoned and reasonable determination.” As already discussed, the court explained its rationale for finding Ozbaki in contempt, and at least in part that rationale was that a provision in the 2005 order explicitly directed Ozbaki to report income changes that affected his ability to pay child support, which Ozbaki failed to do. As a result, Altass did not know that she would have had grounds to seek increased support, and she lost the chance to ask for it.
¶20 As far as the specific amount imposed as a compensatory purge
condition, $27,000, the court had heard Altass’s argument explaining why this
amount approximated the lost opportunity Altass suffered due to Ozbaki’s
failure to update his financial information. Ozbaki did not contest Altass’s calculation of
her losses; he continued to argue that contempt was inappropriate because he
did not willfully violate the underlying order.
The same is true with respect to the attorney fees Altass was forced to incur
due to Ozbaki’s contemptuous failure to abide by his affirmative duty to update
his income information on his own; Altass provided a detailed accounting of
those fees. In short, there is nothing
in the record or Ozbaki’s appellate briefs that undermines the court’s finding
that $27,000 was an appropriate purge condition to compensate Altass for the
lost opportunity at increased child support resulted from Ozbaki’s contempt or
its finding that the attorney fees were “reasonable.”
By the Court.—Order affirmed.
This opinion will not be published. See Wis. Stat. Rule 809.23(1)(b)4.
[1] This appeal is decided by one judge pursuant to Wis. Stat. § 752.31(2)(h) (2011-12). All references to the Wisconsin Statutes are to the 2011-12 version unless otherwise noted.
[2] The relevant statutes were renumbered and slightly amended in 2005. See 2005 Wis. Act 443, §§ 113, 122. Wisconsin Stat. § 767.27(2m) is now Wis. Stat. § 767.54 (2011-12) and Wis. Stat. § 767.263 (2003-04) is now Wis. Stat. § 767.58 (2011-12). These amendments are immaterial to this appeal.
[3] Altass quoted the renumbered and amended version of the statute, Wis. Stat. § 767.54 (2011-12) in her 2013 motion, but at the time of the child support order in this action virtually identical obligations were imposed by Wis. Stat. § 767.27(2m) (2003-04). As already discussed, the amendment is immaterial to the issues at hand.
[4] In attempting to prove that the court found Ozbaki in contempt based upon a statutory obligation to exchange and update information, rather than based upon the 2005 order, Ozbaki cites in particular one portion of the hearing transcript in which the court rejected Ozbaki’s argument that Frisch was distinguishable due to the absence of statutory language in the order in this case. In this part of the hearing, Ozbaki objected to any questioning of Altass concerning the financial situation of Altass and the parties’ son in prior years, arguing that Frisch was irrelevant because “there was no underlying order in the [2005 order] that there be an exchange of financial information.” While the court did at one point seem to suggest that it did not “need” the 2005 order to support a contempt finding, because of the independent statutory obligation, the court also pointed out that “the order,” as well as the statutory requirement, was “in effect.” In any event, in its final determination at the conclusion of the hearing, the court found Ozbaki in contempt at least in part due to his unreasonable interpretation of the 2005 order and failure to recognize that it imposed an affirmative duty to report his greatly increased income.