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COURT OF APPEALS DECISION DATED AND RELEASED July 30, 1996 |
NOTICE |
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A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See § 808.10 and
Rule 809.62, Stats. |
This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official Reports. |
No. 95-1229
STATE
OF WISCONSIN IN COURT OF
APPEALS
DISTRICT I
IN RE THE MARRIAGE OF:
TIMOTHY J. GROSS,
Petitioner-Appellant,
v.
GAIL M. GROSS
(n/k/a GAIL M.
HICKEY),
Respondent-Respondent.
APPEAL from an order of
the circuit court for Milwaukee County:
DOMINIC S. AMATO, Judge. Affirmed
in part; reversed in part and cause remanded.
Before Sullivan, Fine
and Schudson, JJ.
PER
CURIAM. Timothy J. Gross appeals from an order modifying the child
support provisions of his divorce judgment.
He argues in his pro se brief that the trial court erred in: (1)
its application of the serial family payer rule to his ex‑wife, Gail M.
Gross; (2) its calculation of the amount of support; (3) its order that Gail
pay into an emergency/education fund for the children; (4) its failure to make
the order retroactive; and (5) its allocation of the children's income tax
dependency designation. We affirm the
lower court's order with respect to issues two, three, and four. We reverse on issues one and five and remand
for further proceedings.
I. Background.
Timothy and Gail Gross
were married on June 8, 1985, and divorced on October 27, 1988. They had two children. At the time of the divorce, Timothy worked
with the United States Air Force/Wisconsin Air National Guard and had a gross
monthly income of $1,830. Gail was a
cosmetologist earning $800 per month.
She had moved to Florida at the time of the divorce. During the divorce proceedings, the parties
entered into a written stipulation covering several issues including child
support. The stipulation stated that
both parties were fit and proper persons for the children's custody and that
joint custody be awarded with primary physical placement of both children to
Timothy. These provisions were
incorporated into the divorce decree.
The court held support open for one year because of Gail's limited
income and the significant travel expenses involved in visiting her children.
After a year, Timothy
petitioned the court to order Gail to begin paying support. By this time, Gail had returned to
Milwaukee. While her visitation costs
were no longer significant, the court did not grant support because Gail was
pregnant, had minimal income, and was attending school. The court stated that it would rehear the
matter in ten months. When the court
addressed the issue again in October of 1990, Timothy earned $2,139 per month,
and his new wife earned $1,500 per month.
Gail earned $645 per month as an in-home babysitter. She had also remarried, and her husband
earned $2,000 per month. The court
ordered Gail to pay $100 per month support payments.
Upon a subsequent review
of Gail's income, a Family Court Commissioner increased the support payments to
$331 per month support beginning May 6, 1994.
Timothy filed a motion to review this order and requested that support
be set at 25% of Gail's gross income.
Upon review, the trial court found that Gail was earning $31,200 per
year and receiving an additional $3,240 per year in support payments for her
third child from her second marriage.
Based on Gail's responsibilities toward her third child, the court made
a serial family payer adjustment of 17%, reducing the base amount to $25,900. The court then applied the Wis. Adm. Code § HSS 80.03(1)(b)
percentage standard required by § 767.25(1j), Stats., and determined that Gail pay $531 per month.[1] The court ordered that Gail continue to pay
Timothy $331 per month and that she pay $200 per month into a joint savings
account to serve as an emergency/education fund for the children. It also ordered that Gail could claim one of
the children as a dependent for federal and state income tax purposes. Timothy appeals from this order and raises
five issues. We deal with each issue
seriatim.
II. Analysis.
A. Serial Family
Payer Rule.
We first address whether
the court applied the serial family payer rule appropriately. The rule is found in Wis. Adm. Code § HSS 80.04(1) and whether to apply it
turns on the interpretation of the administrative provisions relating to its
application. Sommerfield v.
Sommerfield, 154 Wis.2d 840, 846, 454 N.W.2d 55, 58 (Ct. App.
1990). It is a question of law that we
review de novo. Id.
at 846‑47, 454 N.W.2d at 58.
Under Wis. Adm. Code
§ HSS 80.02(21), a “serial family payer” is “a payer with an existing
child support obligation who incurs an additional child support obligation in a
subsequent family or as a result of a paternity judgment.” In determining the applicability of the
serial family payer rule, § HSS 80.04(1) provides:
(1) Determining
the child support obligation of a serial family payer. For a serial family payer the child support
obligation may be determined as follows:
(a) Determine the payer's base in
accordance with s. HSS 80.03(1) (intro.);
(b) Determine the payer's adjusted base
by applying one of the following methods, as appropriate:
1. When the payer is
subject to an existing support order, subtract the amount of the court-ordered
support, if it is being paid, from the base to get the adjusted base; or
2. When the payer has
other children legally under his or her care who are not subject to a court
order, multiply the appropriate percentage for the number of children legally
under the payer's care by the base as determined on the worksheet. Subtract this amount from the base to
determine the adjusted base; and
(c) Multiply the appropriate percentage
for the number of children subject to the new order by the adjusted base
determined in either par. (b) 1 or 2 to determine the child support obligation.
Underlying
this provision is the idea that “the parent who brings children into the world
knowing the existing prior obligation should not be entitled to an automatic
reduction of child support.” Brown
v. Brown, 177 Wis.2d 512, 521, 503 N.W.2d 280, 283 (Ct. App. 1993).
In her brief, Gail
accurately describes the court's reasoning in determining the support amount:
The judge took [Gail's]
annual income of $31,200 and subtracted the Wis. Admin. Code HSS 80.04 figure
of 17% for one of [Gail's] children (the child from the later marriage) and
arrived at a rounded figure of $25,900.
He used this amount as the adjusted basis for support of the two
children before the court. He then took
the two-child support figure of 25% from the $25,900 and arrived at the rounded
result of $6,475. Dividing that amount
by twelve the court arrived at a rounded monthly support figure of $540 for the
children of [Gail] and [Timothy].
Gail concedes that the
court misapplied the serial family payer rule when it made the 17%
adjustment. We agree. The serial family payer rule can only be
used to adjust support payments for the later born children of subsequent
relationships. Id. at
522, 503 N.W.2d at 284. It cannot be
used to reduce the support payments for the earlier born children because “a
parent's voluntary reduction of the ability to support a family by having more
children should not automatically penalize the earlier born children.” Id. at 521, 503 N.W.2d at
283. While § 767.25(lm), Stats., allows the court to deviate
from the percentage standards if appropriate, the deviation in this case did
not rely on this statute. It was the
result of the inappropriate application of the serial family payer rule. We remand this issue to the trial court for
redetermination.
B. Calculation of
Support Liability.
Aside from the
misapplication of the serial family payer rule, Timothy argues that the court
made other errors in calculating Gail's support obligation. He claims that the court erred in failing to
require Gail to produce financial statements.
He also objects to the court's decision to set the support amount as a
fixed figure rather than as a percentage of Gail's income.
The trial court's
determination of child support will not be reversed on appeal unless the trial
court erroneously exercises its discretion.
Drier v. Drier, 119 Wis.2d 312, 318, 351 N.W.2d 745, 748
(Ct. App. 1984). Here, the trial court
did not require Gail to produce her financial records, but instead relied on
Gail's in-court admissions of gross income.
Timothy fails to provide this court with an authority on why this was an
erroneous exercise of discretion.
Further, the trial court
did not erroneously exercise its discretion when it set a fixed amount of
support rather than an amount in terms of a percentage of income. It is clear from the record that the trial
court calculated the support amount using the percentage standard as required
by § 767.25(1j), Stats. The statute does not require that support be
expressed as a percentage, and we see no reason why establishing a fixed amount
is a misuse of discretion. We affirm
the court's calculation as it relates to these issues.
C. Unconventional
Means of Support Payment.
Timothy contends that
the trial court's order to establish a savings account benefitting the children
is a deviation from conventional means of support. He claims that its failure to state reasons for such a deviation
was a violation of Chapter 767, Stats. We disagree. Section 767.25(2), Stats.,[2]
empowers the trial court to create such a fund, and this court has approved the
practice. See Hubert v.
Hubert, 159 Wis.2d 803, 817, 465 N.W.2d 252, 257 (Ct. App. 1990). We see no erroneous exercise of discretion,
but the trial court may wish to reconsider the matter upon its recalculation of
support. We have noted that when a
trial court establishes a separate fund, the trial court should make findings
on the need for the fund to promote and protect the interests of the children
during minority; specify the type of fund and how it will be accessed; and
require the party holding the passbook to render to the other party a periodic
accounting for any monies expended.
D. Retroactivity of
Order.
Timothy argues that the
order increasing support entered February 3, 1995, should be made retroactive
to October 14, 1993. We reject this
argument because the trial court had no authority to make such an order
retroactive. The supreme court has
stated that “[a] trial court in Wisconsin has no authority to make an order
directing the retroactive increase of support payments.” Strawser v. Strawser, 126
Wis.2d 485, 489, 377 N.W.2d 196, 198 (Ct. App. 1985). The trial court did not err in failing to make the order
retroactive.
E. Use of Children as
Dependents for Tax Purposes.
Timothy argues and Gail
concedes that his due process rights were violated when the trial court awarded
Gail a federal and state income tax dependency exemption for one of the
children. Gail's former attorney
apparently included the provision when it prepared the support order that the
trial court adopted on February 3, 1995.
The tax dependency exemption was approved without motion, notice, or
hearing on the issue.
Section 767.25(1)(b), Stats., provides that if the parties do
not agree, the court is to determine the tax exemption status of each child in
accordance with state and federal tax laws.
In making the decision, the statute requires the court to consider who
is responsible for the health care needs of the child, whether the child is
covered by insurance, and other related matters. The record does not indicate that any such consideration was done;
thus, there was a violation of due process.
See Mullane v. Central Hanover Trust, 339 U.S. 306,
313 (1950) (holding that due process requires an opportunity to be heard). We direct the trial court to vacate that
part of its order. Of course, the parties
are free to pursue the matter by agreement or motion and notice if they desire.
III. Summary.
In sum, we remand the
support matter for recalculation without a serial family payer adjustment. The trial court may deviate from the
percentage standard if it finds it appropriate to do so under
§ 767.25(lm), Stats. We affirm the creation of a fund as part of
the support award with the suggestion that, if the parties cannot agree, the
trial court make findings concerning the nature and the control of the
fund. Finally, that portion of the
order awarding Gail a one-child dependency exemption is vacated.[3]
By the Court.—Order
affirmed in part; reversed in part and cause remanded.
This opinion will not be
published. See Rule 809.23(1)(b)5, Stats.