Schieffer v. Schieffer ( 2013 )

#26101-a-DG
2013 S.D. 11IN THE SUPREME COURT
OF THE
STATE OF SOUTH DAKOTA
****
CARMEN COLETTE SCHIEFFER, Plaintiff and Appellant,
v.
KEVIN VICTOR SCHIEFFER, Defendant and Appellee.
****
APPEAL FROM THE CIRCUIT COURT OF
THE SECOND JUDICIAL CIRCUIT
LINCOLN COUNTY, SOUTH DAKOTA
****
THE HONORABLE DOUGLAS E. HOFFMAN
Judge
****
LINDA LEA M. VIKEN
KYLIE M. RIGGINS of
Viken Law Firm
Rapid City, South Dakota Attorneys for plaintiff
and appellant.
THOMAS J. WELK
JASON R. SUTTON of
Boyce, Greenfield, Pashby & Welk, LLP
Sioux Falls, South Dakota Attorneys for defendant
and appellee.
****
ARGUED OCTOBER 2, 2012
OPINION FILED 01/23/13
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GILBERTSON, Chief Justice
[¶1.] On July 12, 2011, the trial court granted Kevin Schieffer and Carmen
Schieffer a divorce on grounds of irreconcilable differences. In its judgment and
decree of divorce, the trial court denied Carmen’s request to relocate to New York
City with the minor children, granted Kevin and Carmen joint legal and physical
custody of the minor children, implemented a custody schedule, ordered Kevin to
pay Carmen child support, resolved the disputed property issues, and denied
Carmen’s request for attorney fees. Carmen appeals various aspects of the trial
court’s decision. We affirm.
FACTS
[¶2.] Kevin and Carmen met in 1999. From 1999 to 2007, Kevin and
Carmen were involved in an “on again, off again,” long distance relationship, with
Kevin primarily residing in Sioux Falls, South Dakota, and Carmen living various
places including New York City, New York. While in New York City, Carmen was
employed as a vice president of an international insurance and investment
company. Kevin worked as the CEO of Dakota, Minnesota, and Eastern Railroad
(DM&E) in Sioux Falls. Kevin was also a shareholder of DM&E.
[¶3.] Kevin amassed a considerable amount of wealth throughout his career,
acquiring much of his wealth as a result of the sale of DM&E in October 2007.
Kevin was required to continue working for DM&E during a period of transition as
part of the sale. However, after completing the transition in October 2008, Kevin
ceased working for DM&E. Neither Kevin nor Carmen has worked outside of the
home since that time.
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[¶4.] In 2007, the parties learned Carmen was pregnant. Kevin and
Carmen then married on September 22, 2007. 1 The parties’ daughter (AC-AS) was
born on March 6, 2008. AC-AS was born with Down syndrome. In addition, AC-AS
was born with a heart defect that required her to have surgery in New York City
shortly after her birth. As a result, Carmen and AC-AS lived in New York City for
approximately the first five months of AC-AS’s life. Carmen and AC-AS then moved
to Sioux Falls to live with Kevin.
[¶5.] AC-AS has received various services and therapies to help treat the
symptoms of her Down syndrome since her birth. These services include physical
therapy, occupational therapy, speech therapy, music therapy, etc. Some of these
services are provided by the State of South Dakota. 2 However, Kevin and Carmen
have continuously supplemented these services with “private pay” therapy services.
Typically, AC-AS participates in at least 12 hours of therapist-led therapy sessions
each week. Additionally, Carmen has pursued alternative treatments for AC-AS.
For example, AC-AS is on a special diet and takes various vitamins and
supplements daily.
1. Kevin and Carmen signed a prenuptial agreement prior to their marriage.
According to the prenuptial agreement, Carmen was entitled to a payment of
$5 million if she did not seek spousal support in the event of a divorce, and $1
million if she did pursue spousal support.
2. From birth to age three, the therapy services provided to AC-AS by the State
were determined based upon recommendations from AC-AS’s Individualized
Family Service Plan (IFSP). At age three, the services provided to AC-AS
under her IFSP terminated. The Sioux Falls School District then evaluated
AC-AS and determined the new level of State-provided therapy she should be
awarded. An Individual Education Plan (IEP) was created for AC-AS based
on this evaluation.
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[¶6.] On October 15, 2009, Carmen formally notified Kevin that she
intended to relocate from Sioux Falls to New York City because she believed
facilities in New York City could provide AC-AS with better therapy services and
educational opportunities. At the time, Carmen was pregnant with the parties’ son
(AE-VS). Kevin resisted the proposed relocation. As a result, Carmen filed a
complaint on December 14, 2009, in which she sought separate maintenance,
custody, child support, permission to relocate, and attorney fees. In response, Kevin
objected to the proposed relocation and counterclaimed for a declaratory judgment
based on the parties’ prenuptial agreement.
[¶7.] The trial court held a hearing on February 11-12, 2010, to address the
interim issues of child support, visitation, and attorney fees. After the hearing, the
trial court entered a memorandum decision and interim order to establish the rights
and obligations of the parties until the occurrence of a trial, which was originally set
for July 2010, but was later moved to November 2010. Kevin and Carmen’s son AE-
VS was born on May 4, 2010.
[¶8.] On October 11, 2010, Kevin amended his answer and counterclaim,
seeking a divorce from Carmen on the grounds of irreconcilable differences. Prior to
their divorce trial, Kevin and Carmen stipulated to the enforceability of their
prenuptial agreement. The parties’ divorce trial was held on November 15-19, 2010.
At trial, Kevin and Carmen disputed various issues. Some of the more significant
issues included: whether New York City could provide better services to AC-AS
than Sioux Falls; whether AC-AS participated in an appropriate amount of therapy;
and whether the type and quantity of supplements AC-AS was taking was
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appropriate. Over the course of the trial and prior hearings, the parties and more
than 15 experts provided testimony regarding these and other issues.
[¶9.] On March 4, 2011, the trial court entered extensive findings of fact and
conclusions of law based on the evidence presented at both the February 2010
hearing and the November 2010 trial. However, both parties moved for
reconsideration/clarification/amendment of the trial court’s findings. The trial court
addressed these motions at a hearing held on May 23, 2011. On July 12, 2011, the
trial court entered an order on the parties’ motions for reconsideration, a judgment
and decree of divorce, and amended findings of fact and conclusions of law.
[¶10.] The trial court’s amended findings of fact and conclusions of law
consisted of 161 findings and 47 conclusions that were incorporated by reference
into the judgment and decree of divorce. This Court addresses only those portions
of the judgment and decree of divorce that are relevant to this appeal. In its
judgment and decree of divorce, the trial court granted Kevin a divorce based upon
irreconcilable differences and denied Carmen’s request to relocate to New York City.
The trial court ordered Kevin to pay Carmen $3,971,973.90 to satisfy the $5 million
total she was entitled to under the prenuptial agreement. In addition, the trial
court awarded Kevin and Carmen joint legal and physical custody of AC-AS and
AE-VS. The trial court also adopted a modified version of the custody schedule
proposed by Dr. Price (Kevin’s expert).
[¶11.] With regard to AC-AS’s therapy, the trial court ordered that the State-
provided therapy granted to AC-AS under her IEP would be the minimum amount
of therapy AC-AS would receive. The trial court also ordered that the
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recommendations of AC-AS’s doctor (Dr. Blake) would control matters in which the
parties disagreed about the healthcare needs of the children, including disputes
about additional therapy for AC-AS. Further, the trial court ordered that Kevin be
permitted to take part in determining the appropriate financial terms for certain
services Carmen specifically wanted AC-AS to participate in, assuming Dr. Blake
found these services to be appropriate.
[¶12.] Additionally, the trial court rejected Carmen’s request for child support
of more than $25,000 per month. In Carmen’s reply brief and Exhibit 423, Carmen
clarifies that approximately $9,200 of the $25,000 total is attributable to costs
associated with the children’s actual needs and standard of living (“base” child
support), while the remaining costs of $15,800 are attributable to AC-AS’s special
needs. In rejecting Carmen’s child support request, the trial court instead ordered
Kevin to pay Carmen “base” child support of $2,815 per month. The trial court also
ordered Kevin to pay for health insurance for the children, 95 percent of AC-AS’s
therapy costs, 95 percent of the supplemental costs associated with AC-AS’s special
needs, 95 percent of the children’s uncovered medical expenses, 95 percent of the
nanny expenses incurred until AC-AS entered preschool, and 95 percent of private
school tuition (if applicable). Finally, the trial court denied Carmen’s request for
attorney fees of more than $370,000. Carmen appeals several of the trial court’s
determinations.
STANDARD OF REVIEW
[¶13.] “[This Court] review[s] child custody decisions under the abuse of
discretion standard of review.” Simunek v. Auwerter, 2011 S.D. 56, ¶ 8, 803 N.W.2d
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835, 837 (citing Fuerstenberg v. Fuerstenberg, 1999 S.D. 35, ¶ 22, 591 N.W.2d 798,
807). In addition, the trial court’s decisions regarding child support and the
division of property are reviewed for an abuse of discretion. Hill v. Hill, 2009 S.D.
18, ¶ 5, 763 N.W.2d 818, 822 (citing Billion v. Billion, 1996 S.D. 101, ¶ 14, 553
N.W.2d 226, 230). Further, “[a] circuit court’s ruling on the allowance or
disallowance of costs and attorney fees is also reviewed by this Court under the
abuse of discretion standard of review.” Terca v. Terca, 2008 S.D. 99, ¶ 18, 757
N.W.2d 319, 324 (citing Eccleston v. State Farm Mut. Auto. Ins. Co., 1998 S.D. 116,
¶ 20, 587 N.W.2d 580, 583).
[¶14.] “An abuse of discretion is ‘a discretion exercised to an end or purpose
not justified by, and clearly against, reason and evidence.’” Hill, 2009 S.D. 18, ¶ 5,
763 N.W.2d at 822 (citing Laird v. Laird, 2002 S.D. 99, ¶ 13, 650 N.W.2d 296, 299).
In the context of reviewing custody decisions, “[a]n abuse of discretion occurs . . .
when the trial court’s review of the traditional factors bearing on the best interests
of the child is scant or incomplete.” Kreps v. Kreps, 2010 S.D. 12, ¶ 25, 778 N.W.2d
835, 843 (quoting Pietrzak v. Schroeder, 2009 S.D. 1, ¶ 37, 759 N.W.2d 734, 743).
[¶15.] On appeal, findings of fact are reviewed under the clearly erroneous
standard of review. Id. As a result, this Court “will overturn the trial court’s
findings of fact on appeal only when a complete review of the evidence leaves [this]
Court with a definite and firm conviction that a mistake has been made.” Id.Further, this Court gives due regard to the trial court’s opportunity “to judge the
credibility of witnesses and to weigh their testimony[.]” Walker v. Walker, 2006
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S.D. 68, ¶ 11, 720 N.W.2d 67, 70-71 (quoting Midzak v. Midzak, 2005 S.D. 58, ¶ 14,
697 N.W.2d 733, 738).
ANALYSIS AND DECISION
[¶16.] 1. Whether the trial court’s amended findings of fact
regarding the custody determination factors were clearly
erroneous, causing the trial court’s joint legal and
physical custody award to be an abuse of discretion.
[¶17.] When determining custody, “the court shall be guided by consideration
of what appears to be for the best interests of the child in respect to the child’s
temporal and mental and moral welfare.” SDCL 25-4-45. “The trial court may, but
is not required to, consider the following [Fuerstenberg] factors in determining the
best interests and welfare of the child: parental fitness, stability, primary caretaker,
child’s preference, harmful parental misconduct, separating siblings, and
substantial change of circumstances.” Simunek, 2011 S.D. 56, ¶ 9, 803 N.W.2d at
837 (quoting Kreps, 2010 S.D. 12, ¶ 26, 778 N.W.2d at 843). In evaluating parental
fitness, a trial court may consider the following subfactors:
(1) mental and physical health; (2) capacity and disposition to
provide the child with protection, food, clothing, medical care,
and other basic needs; (3) ability to give the child love, affection,
guidance, education and to impart the family’s religion or creed;
(4) willingness to maturely encourage and provide frequent and
meaningful contact between the child and the other parent; (5)
commitment to prepare the child for responsible adulthood, as
well as to insure that the child experiences a fulfilling childhood;
and (6) exemplary modeling so that the child witnesses
firsthand what it means to be a good parent, a loving spouse,
and a responsible citizen.
Kreps, 2010 S.D. 12, ¶ 26, 778 N.W.2d at 843-44. Subfactors examined when
considering stability include:
(1) the relationship and interaction of the child with the parents,
step-parents, siblings and extended families; (2) the child’s
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adjustment to home, school and community; (3) the parent with
whom the child has formed a closer attachment, as attachment
between parent and child is an important developmental
phenomena and breaking a healthy attachment can cause
detriment; and (4) continuity, because when a child has been in
one custodial setting for a long time pursuant to court order or
by agreement, a court ought to be reluctant to make a change if
only a theoretical or slight advantage for the child might be
gained.
Price v. Price, 2000 S.D. 64, ¶ 27, 611 N.W.2d 425, 432.
[¶18.] “‘We encourage trial courts to take a balanced and systematic
approach’ when applying the factors relevant to a child custody proceeding.”
Simunek, 2011 S.D. 56, ¶ 9, 803 N.W.2d at 837 (quoting Fuerstenberg, 1999 S.D. 35,
¶ 23, 591 N.W.2d at 807). See also Kreps, 2010 S.D. 12, ¶ 28-29, 778 N.W.2d at 844(reiterating that courts should utilize a balanced and systematic approach in
analyzing the various factors applicable to child custody proceedings, and clarifying
that this Court has never held that the primary caretaker factor should prevail over
all other factors considered by the trial court).
[¶19.] Carmen argues that several of the trial court’s amended findings of
fact are clearly erroneous, and that the joint legal and physical custody award was
an abuse of discretion as a result. However, Carmen’s claims of error are without
merit because the record supports the trial court’s amended findings of fact. For
example, Carmen challenges Amended Finding of Fact 74, which deals with
“fitness” subfactor 5. Carmen argues the trial court committed clear error in
finding that Kevin was more capable than Carmen to prepare the children for
responsible adulthood while simultaneously ensuring that they had the benefit of a
fulfilling childhood. She argues that she “fully appreciates the importance of
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playtime, socialization, and family for children and worked hard to incorporate
them all, along with the therapy AC-AS requires.”
[¶20.] However, a review of the record demonstrates that Carmen heavily
favored therapy over playtime and time with family. For example, AC-AS spent
over 1200 hours in therapy sessions before turning age two, yet she spent no time
with other children. Further, Carmen prevented AC-AS from socializing with the
children in Kevin’s family, and only began allowing AC-AS to interact with other
children after the February 2010 hearing. At one point during the February 2010
hearing, Carmen was asked for the names of AC-AS’s playmates. Carmen replied
that AC-AS had no playmates. Therefore, Amended Finding of Fact 74 was not
clearly erroneous.
[¶21.] As an additional example, Carmen argues that Amended Finding of
Fact 81 is clearly erroneous. Carmen challenges the trial court’s finding that she
indicated she does not think family is as important as therapy. However, once
again, the record supports this finding. When Carmen was asked to respond to
Kevin’s concern about being far from family if she and the children relocated to New
York City, Carmen stated that family was very important, but that she did not
think family was as important as the therapy opportunities AC-AS would have in
New York. This testimony demonstrates that Amended Finding of Fact 81 was not
clearly erroneous.
[¶22.] Overall, Carmen has not shown that the trial court’s amended findings
of fact were clearly erroneous. As noted above, it is within the prerogative of the
trial court to resolve conflicts of evidence, judge the credibility of witnesses, and
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weigh the testimony of witnesses. The fact that Carmen disagrees with the trial
court’s findings does not mean they were clearly erroneous. Because the trial
court’s amended findings of fact were supported by the record, Carmen has not
established that the trial court’s amended findings of fact were clearly erroneous.
Furthermore, a review of the record establishes that the trial court engaged in a
balanced and systematic review of each of the Fuerstenberg factors and subfactors
in finding that the best interests of AC-AS and AE-VS supported awarding Kevin
and Carmen joint legal and physical custody. Specifically, the trial court devoted
Amended Finding of Facts 69 through 93 (approximately 8 of the 58 pages of its
amended findings of fact and conclusions of law) to providing detailed evaluations of
each of these factors and subfactors. As a result, the trial court did not abuse its
discretion in awarding Kevin and Carmen joint legal and physical custody of the
children.
[¶23.] 2. Whether the trial court abused its discretion in adopting
a modified version of the custody schedule recommended
by Dr. Price (Kevin’s expert) 3 instead of adopting the
custody schedule proposed by Dr. Ackerman (Carmen’s
expert). 4
3. As to AC-AS, the modified version of Dr. Price’s schedule is a two-week
schedule that essentially gives Kevin and Carmen equal time with AC-AS.
As to AE-VS, the modified version of Dr. Price’s custody schedule allows
Kevin various day and overnight time with AE-VS on a weekly basis, with
Carmen generally receiving more time with AE-VS. The schedule varies
based on AE-VS’s age (12-14 months, 14-16 months, and 16-18 months), and
at 18 months AE-VS’s schedule changes so that he is on the same schedule as
AC-AS.
4. Dr. Ackerman also proposed a two-week schedule for AC-AS. Under this
schedule, Kevin had five overnights with AC-AS and Carmen had nine
overnights with AC-AS over the course of two weeks. The schedule Dr.
(continued . . .)
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[¶24.] “As with all witnesses, it falls on the trier of fact to decide whether to
believe all, part, or none of an expert’s testimony.” Great W. Bank v. H & E Enters.,
LLP, 2007 S.D. 38, ¶ 10, 731 N.W.2d 207, 209 (citing Sauer v. Tiffany Laundry &
Dry Cleaners, 2001 S.D. 24, ¶ 14, 622 N.W.2d 741, 745). As a result, “[i]t is within
the [trial] court’s discretion to choose between conflicting experts.” Simunek, 2011
S.D. 56, ¶ 16, 803 N.W.2d at 838 (citing Wise v. Brooks Constr. Servs., 2006 S.D. 80,
¶ 33, 721 N.W.2d 461, 472-73). Furthermore, SDCL 25-5-7.1 gives a trial court the
authority to order joint legal and physical custody. In ordering joint physical
custody, the trial court may award it “in such proportions as are in the best
interests of the child, notwithstanding the objection of either parent.” SDCL 25-5-
7.1.
[¶25.] At trial, both Kevin and Carmen presented testimony from custody
experts and proposed custody schedules based on this testimony. Carmen argues
the trial court abused its discretion in failing to adopt the custody schedule
________________________
(. . . continued)
Ackerman proposed for AE-VS also varied based on AE-VS’s age (0-18
months, 18-24 months, 24-30 months, 30-36 months), and at 36 months AE-
VS participated in the same schedule as AC-AS. Until 36 months, Dr.
Ackerman’s proposed schedule gave Carmen AE-VS the majority of the time.
According to Dr. Ackerman’s proposed custody schedule, Kevin was generally
given three hour visits with AE-VS a few times per week, and he received
some overnights with AE-VS on alternating weeks. Dr. Ackerman’s proposed
schedule allowed Kevin more overnight visits with AE-VS as AE-VS got
older.
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proposed by Dr. Ackerman for several reasons. For example, she argues Dr.
Ackerman was more qualified than Dr. Price in both training and experience. 5
[¶26.] In this case, the trial court did not abuse its discretion in finding that
the adoption of a modified version of Dr. Price’s proposed custody schedule was in
the best interests of AC-AS and AE-VS. It was within the trial court’s discretion to
weigh the competing opinions of Dr. Price and Dr. Ackerman and to select one of the
proposed custody schedules. The trial court chose to implement a modified version
of Dr. Price’s proposed custody schedule over Dr. Ackerman’s proposed custody
schedule because it provided the children with an equal opportunity to spend time
with both parents and to develop secure attachments to both parents. The trial
court found that this case was unique because both Kevin and Carmen had
substantial assets which eliminated either party’s need to work outside of the home,
thus giving both Kevin and Carmen the ability to devote substantial time to AC-AS
and AE-VS.
[¶27.] Furthermore, the trial court chose to implement a modified version of
Dr. Price’s proposed custody schedule as opposed to Dr. Ackerman’s proposed
custody schedule because the trial court determined that Dr. Price’s opinions were
more consistent with modern research, scholarship, common sense, and public
policy. Additionally, the trial court concluded that Dr. Ackerman’s proposed
5. As an additional argument regarding custody/visitation schedules, Carmen
argues the interim visitation plan implemented after the February 11-12,
2010, hearing was improper for multiple reasons. However, “[i]t is settled
law in this State that a temporary custody order no longer in effect is not
subject to review.” In re A.M.L., 371 N.W.2d 358, 359 (S.D. 1985). Therefore,
we decline to address this argument on appeal.
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schedule would unreasonably and unnecessarily limit the children’s ability to
attach to Kevin.
[¶28.] As previously mentioned, the trial court was vested with the discretion
to weigh the opinions of the experts and to select the proposed custody schedule it
found to be most consistent with the best interests of AC-AS and AE-VS. Overall,
the record supports the trial courts findings and supports its decision to adopt a
modified version of Dr. Price’s proposed custody plan. Therefore, the trial court did
not abuse its discretion in adopting a modified version of the custody plan proposed
by Dr. Price.
[¶29.] 3. Whether the trial court abused its discretion in allowing
Kevin to participate in determining the financial terms of
certain services for AC-AS. 6
6. At the May 23, 2011, hearing Carmen sought clarification of the trial court’s
order regarding who would determine what therapies AC-AS would
participate in. Specifically, Carmen was concerned about whether the
supplemental therapies AC-AS received in addition to the therapies she
participated in under her IFSP would continue throughout the summer
before AC-AS entered preschool because AC-AS had turned three, her IEP
evaluation was not complete, and Carmen stated it would take at least three
months to get an appointment with Dr. Blake to resolve disputes about AC-
AS’s supplemental therapy needs. Carmen requested that the supplemental
therapies AC-AS had under her IFSP continue until the parties could meet
with Dr. Blake after AC-AS’s IEP evaluation. In addition to Carmen’s
arguments regarding Kevin’s involvement in determining the terms of
certain services provided to AC-AS, Carmen also argues the trial court erred
in giving Kevin the authority to immediately cut all of AC-AS’s supplemental
therapy after AC-AS’s IEP evaluation. However, Carmen mischaracterizes
the trial court’s decision on this issue. The trial court did not give Kevin
unilateral power to permanently cut therapy. Instead, the trial court
determined that AC-AS’s current therapies would continue until the IEP plan
was finalized. At that point, the parties would make arrangements for
supplemental therapies for AC-AS. If the parties disagreed about the
supplemental therapies, Dr. Blake would be consulted to resolve the disputes.
(continued . . .)
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[¶30.] SDCL 25-5-7.1 provides:
In ordering joint legal custody, the court may consider the
expressed desires of the parents and may grant to one party the
ultimate responsibility over specific aspects of the child’s welfare
or may divide those aspects between the parties based on the
best interest of the child. . . . [T]he court may order, or the
parties may agree, how any such responsibility shall be divided.
In awarding Kevin and Carmen joint legal custody, the trial court gave Carmen the
specific authority to continue the non-speech oral motor therapies (such as
TalkTools and PROMPT) that AC-AS had previously received, provided that Dr.
Blake did not find these therapies to be harmful to AC-AS. 7 The trial court also
gave Carmen the authority to decide whether or not to utilize a Special Education
Itinerant Teacher (SEIT) to assist AC-AS when AC-AS entered school. However,
the trial court ordered that Kevin have the authority to participate in determining
the appropriate financial terms for these services. With regard to the SEIT, Kevin
was also allowed to participate in setting the reasonable duties, terms, and
conditions of the employment relationship, and was allowed to participate in
interviewing and hiring the SEIT. 8 Carmen argues the trial court abused its
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(. . . continued)
Thus, the trial court did not give Kevin unilateral authority to permanently
cut AC-AS’s supplemental therapy.
7. In Amended Finding of Fact 121 the trial court stated that “unless Dr. Blake
specifically advises against such therapy as being inconsistent with [AC-AS]’s
best interests, the Court is of the view that Carmen should be allowed to
involve Sara Rosenthal-Johnson’s oral-motor therapy methods, specifically
TalkTools and PROMPT, within [AC-AS]’s therapy regimen.”
8. In full, Amended Finding of Fact 123 provides:
In addition, if the parties cannot agree, then Carmen shall have
authority to choose whether or not to incorporate the services of a
(continued . . .)
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discretion in allowing Kevin to participate in establishing the financial terms of
these services, claiming that this grant of authority essentially gave Kevin the
power to block AC-AS’s receipt of these services. She asserts that Kevin might
require that the services be obtained at a rate that proves to be unacceptable to the
therapists, making it impossible to find therapists to provide these services to AC-
AS.
[¶31.] However, Carmen’s argument lacks merit. In allowing Kevin to
participate in determining the financial terms for AC-AS’s non-oral motor therapies
and SEIT services, the trial court did not give Kevin the power to block AC-AS’s
receipt of these services altogether. On the contrary, Carmen retained the full
authority to continue these services assuming Dr. Blake did not find them to be
inconsistent with AC-AS’s best interests. Therefore, the only person with the
ability to block AC-AS’s receipt of the non-oral motor therapies and SEIT services is
Dr. Blake. 9 Further, there is no indication that the trial court meant to allow Kevin
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(. . . continued)
SEIT for [AC-AS], but with the limitation that if the decision to utilize
a SEIT is made, Kevin shall participate fully and equally in the
process of determining the reasonable duties, terms, and conditions of
the employment relationship, interviewing and hiring the SEIT, and
setting the reasonable compensation to be offered to the SEIT. [AC-
AS] may utilize a SEIT or similar services for summer camps at the
Excel School if the parties agree. If the parties cannot reach an
agreement regarding the hiring or duties of the SEIT or similar
services for the summer camps, then [AC-AS] shall be provided a SEIT
or similar services if Dr. Blake determines that a SEIT or similar
services for the summer camps is in [AC-AS]’s best interest.
9. With regard to the SEIT services, it is unclear from Amended Finding of Fact
123 whether Dr. Blake is to resolve all disputes regarding SEIT services, or
only those disputes related to the provision of SEIT services during AC-AS’s
(continued . . .)
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to use his authority as a means of blocking AC-AS’s receipt of these services by
insisting upon financial terms that were unacceptable to the therapists. Such an
understanding would be entirely inconsistent with the trial court’s specific grant of
authority to Carmen with regard to the continuation of these services.
[¶32.] Instead, in reviewing the judgment and decree of divorce in its
entirety, the trial court’s division of authority balanced the interests of both Kevin
and Carmen. In its amended findings of fact, the trial court found that Carmen’s
spending was irresponsible and excessive. Further, it found that the non-speech
oral motor therapies were expensive and controversial, and that it was unclear
whether or not the services actually caused AC-AS’s speech to improve. However,
the trial court found that Carmen was passionate about AC-AS’s receipt of these
________________________
(. . . continued)
summer camps. Given that the trial court gave Dr. Blake the ultimate
authority with regard to all of the children’s healthcare needs, including the
provision of therapies for AC-AS, the most appropriate understanding of
Amended Finding of Fact 123 is that Dr. Blake has the authority to resolve
all disputes regarding SEIT services for AC-AS. However, even if Dr. Blake
only had authority to resolve disputes regarding the provision of SEIT
services during AC-AS’s summer camps, the trial court provided for an
additional method of dispute resolution. Amended Finding of Fact 124
provides that:
Resolution of any other co-parenting issues, not expressly
defined above, shall be submitted for resolution by the parties
with the assistance of a mediator, or by a Parenting Coordinator
agreeable to the parties. Only when such attempts have been
exhausted, shall unresolved conflicts be brought before the
Court, unless exigent circumstances warrant bypass directly to
the judicial process.
Therefore, even if the parties cannot agree on the terms and conditions of
SEIT services for AC-AS, Kevin does not have the ability to block AC-AS’s
receipt of SEIT services altogether. Instead, a mediator or Parenting
Coordinator will resolve any disputes (keeping in mind that the trial court
specifically gave Carmen the authority to make the initial determination of
whether or not to utilize SEIT services for AC-AS).
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services and that Carmen’s ability to co-parent with Kevin would be negatively
impacted if these services were terminated. By giving Kevin the ability to
participate in determining the financial terms of these services, the trial court
balanced Carmen’s interest in continuing the therapy services she strongly believed
were imperative to AC-AS’s improvement with Kevin’s interest in ensuring that
these services were provided at costs that were not unnecessary or excessive.
Therefore, although Kevin has the ability to give input, he does not have the
authority to block AC-AS’s receipt of the non-speech oral motor therapies and SEIT
services. As a result, the trial court did not abuse its discretion in giving Kevin the
authority to participate in determining the financial terms of AC-AS’s non-speech
oral motor therapies and SEIT services. 10
[¶33.] 4. Whether the trial court abused its discretion in ordering
Kevin to pay “base” child support of $2,815 per month.
[¶34.] “The court is required to set a child support obligation based on an
income schedule established by the Legislature.” Hill, 2009 S.D. 18, ¶ 6, 763
N.W.2d at 822. “[T]he combined monthly net incomes of both parents shall be used
in determining the obligation which shall be divided proportionately between the
10. Carmen also argues that an incident involving the SEIT issue, which
occurred after the trial court entered its judgment and decree of divorce,
supports her claim that the authority granted to Kevin allows him to block
AC-AS’s receipt of SEIT services. The incident referenced by Carmen is that
AC-AS was unable to start preschool because the parties disagreed about who
the SEIT would be, and who (Dr. Blake, the parties’ parenting coordinator, or
the trial court) would resolve the parties’ dispute about selection of the SEIT.
However, Carmen fails to recognize that the complication arose from the need
for clarification of who would resolve disputes about selection of the SEIT,
rather than from the authority Kevin had to participate in setting the terms
for the SEIT. As a result, Carmen’s argument fails.
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parents based upon their respective net incomes.” SDCL 25-7-6.2. Currently, the
schedule provides child support obligation calculations up to a combined net
monthly income of $20,000. Id.
[¶35.] In situations where the parents’ combined net monthly income exceeds
$20,000, “the child support obligation shall be established at an appropriate level,
taking into account the actual needs and standard of living of the child.” SDCL 25-
7-6.9. Further, “the trial court may calculate support by mathematical
extrapolation, but it is not obligated to do so. . . . [T]he essential inquiry remains the
actual needs and standard of living of the children.” Bloom v. Bloom, 498 N.W.2d
213, 217 (S.D. 1993) (citing Earley v. Earley, 484 N.W.2d 125, 127-28 (S.D. 1992)).
In addition, the party requesting child support in excess of the schedule “has the
burden of proving [the] claimed expenses reflect the children’s needs and standard
of living.” Evans v. Evans, 1997 S.D. 16, ¶ 20, 559 N.W.2d 240, 245 (citing Billion,
1996 S.D. 101, ¶ 40, 553 N.W.2d at 235). However, “[a] trial court is not required to
accept either party’s claimed expenses.” Id.[¶36.] The trial court determined that Kevin’s annual income (including the
imputation of minimum wage) was $2,115,080; whereas Carmen’s annual income
(including the imputation of minimum wage) was $105,080. Based on these figures,
the trial court concluded that the combined monthly income of the parties exceeded
the $20,000 maximum provided by the child support obligation schedule. However,
the trial court ultimately concluded that a child support award in excess of the child
support obligation schedule was unwarranted in this case.
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[¶37.] Instead, the trial court calculated “base” child support at $2,963, which
was the top of the child support obligation schedule for two children. The trial court
ordered that the parties bear this expense based upon the ratio of their levels of
income, meaning that Kevin was responsible for paying 95 percent of this amount,
and Carmen was responsible for paying 5 percent of this amount. The result of
these calculations was that Kevin was responsible for making monthly child
support payments of $2,815. In addition to these “base” payments, the trial court
ordered Kevin to pay 95 percent of several of the children’s other expenses. Carmen
argues the trial court abused its discretion in calculating child support, claiming
she established the actual needs and standard of living of AC-AS and AE-VS
required a “base” child support award of approximately $9,200 per month. 11
[¶38.] In determining the appropriate child support award, the trial court
considered the actual needs and standard of living of both AC-AS and AE-VS. The
trial court found that “base” child support of $2,963 per month properly accounted
for AC-AS’s and AE-VS’s actual needs and standard of living. The trial court made
several findings of fact to support its rationale for awarding “base” child support of
$2,963. First, as to the children’s needs, the trial court found that $2,963 accounted
for the children’s typical expenditures such as food, clothing, transportation, and
housing. Next, with regard to the children’s standard of living, the trial court
specifically found that “[t]here is no evidence that would support the supposition
11. As previously noted, although Carmen requested over $25,000 per month in
child support, only $9,200 of that total constitutes “base” child support used
to provide for the children’s actual needs and standard of living. The
remaining $15,800 of the $25,000 total is attributable to costs associated with
AC-AS’s special needs.
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that the children will be living an opulent or excessive lifestyle in Kevin’s home. To
the contrary, the evidence suggests that Kevin values fiscal discipline . . . .” In
addition, the trial court found that “Kevin’s current home is considerably less
expensive than the current marital residence[,]” and that “the evidence shows that
it is Carmen, rather than Kevin, that would be the driving force behind setting a
standard of living that is inconsistent with the guidelines amounts.”
[¶39.] Further, the trial court found that “[t]he only unusual costs associated
with the standard of living for the children as set forth herein are the costs of [AC-
AS]’s therapy, her potential SEIT, nutritional supplements, and possible private
school tuition.” Beyond those costs, the trial court found that “Carmen has failed to
prove that additional deviation from the child support guidelines is necessary to
serve the children’s actual needs and standard of living.” Carmen has failed to
establish that these findings are clearly erroneous.
[¶40.] Because of AC-AS’s special needs, most of the evidence concerning the
additional expenses associated with the children related exclusively to her.
However the detail of the trial court’s findings on the overall issue of support show
that the trial court considered the needs of each child and did not exclusively focus
on AC-AS. AE-VS is two years old. If AE-VS’s needs change as he ages, as is
expected, the trial court will have discretion to correspondingly raise the support
obligation to meet those needs, provided that Carmen can establish a “substantial
change in circumstances.” See SDCL 25-7A-22.
[¶41.] Additionally, in rejecting Carmen’s request for “base” child support of
approximately $9,200 per month, the trial court concluded that Carmen’s proposed
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expenses were inflated, speculative, and unreliable. A review of the record supports
the trial court’s determinations. For example, when Carmen was asked about her
proposed monthly budget, Carmen was unable to provide a rationale for several of
the expenses. In addition, she agreed that some of the figures were miscalculated.
[¶42.] Furthermore, the trial court found that Carmen’s spending was
“undisciplined” and that her spending habits exhibited her tendencies for “excess
and over-indulgence.” Carmen has also failed to show that these findings were
clearly erroneous. The trial court determined that “it is clearly not appropriate to
increase child support simply to allow a parent to enjoy a desired level of opulence.”
We agree. Simply because Carmen spent excessively during the parties’ marriage
does not mean that Kevin must maintain that standard of living following their
divorce, especially given that Kevin objected to Carmen’s spending during the
marriage and given that the parties’ young children’s actual needs do not
correspond with such an opulent standard of living. See Bloom, 498 N.W.2d at 218
(stating that “[w]hile father’s income and status as a physician might establish that
[designer clothes, cellos, ballet lessons, etc.] are commensurate with the children’s
standard of living, we are not prepared to state that the trial court abused its
discretion in failing to enter such a finding or a finding that these items constitute
actual needs of the children”).
[¶43.] In addition, Carmen did not present any evidence to suggest that the
children’s standard of living would dramatically decrease following the parties’
divorce if Carmen was not awarded her requested amount of child support. In fact,
on appeal Carmen has not alleged that the children’s needs are not being met by
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the current child support award, nor has she alleged that the children’s standard of
living is now inconsistent with the standard of living they had before the parties’
divorce. In Ochs v. Nelson, 538 N.W.2d 527 (S.D. 1995), this Court addressed a
situation where an unmarried mother and father had considerably disproportionate
standards of living because the mother’s earnings were marginal and the father’s
earnings were substantial. In Ochs, this Court affirmed the trial court’s decision to
set child support based on a mathematical extrapolation from the child support
obligation schedule even though the parties’ child had never experienced his
father’s high standard of living because the child was young and had never lived
with his father. Id. at 530-31 (holding that child was entitled to share in some of
father’s high standard of living even though child only resided with mother).
[¶44.] However, this case is distinguishable from Ochs. Unlike the mother in
Ochs, Carmen has substantial assets of her own. Specifically, under the prenuptial
agreement, Carmen received a total of $5 million as part of the parties’ divorce. In
addition, the trial court found that Carmen’s net monthly income including child
support would be over $9,000, which does not account for the $1 million the trial
court expected Carmen to set aside to purchase a home, furnishings, etc. Further,
unlike in Ochs, in this case there is no indication that AC-AS and AE-VS will
experience substantially disproportionate standards of living at the homes of Kevin
and Carmen. As noted above, although Kevin has a higher income and a greater
net worth than Carmen, Kevin is more financially conservative than Carmen.
Therefore, it appears that both Kevin and Carmen will maintain reasonably
equivalent standards of living. The fact that the concerns this Court expressed in
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Ochs regarding situations involving parents with disproportionate standards of
living do not exist in this case provides further support for the trial court’s
determination that a child support award in excess of the child support obligation
schedule was unnecessary in this case. Additionally, if at some point Kevin’s and
Carmen’s standards of living become disproportionate, this disproportionality may
be considered for purposes of modification of the child support award pursuant to
SDCL 25-7A-22 in order to maintain the children’s standard of living. 12
[¶45.] Overall, Carmen has failed to establish that the trial court’s amended
findings of fact regarding its determination of the appropriate child support award
were clearly erroneous. As a result, the trial court did not err in concluding that
Carmen did not meet her burden of proving that her claimed expenses of
approximately $9,200 per month reflected the actual needs and standard of living of
each of the children. Thus, the trial court did not abuse its discretion in
determining that the actual needs and standard of living of the children would be
provided for by Kevin paying Carmen “base” child support of $2,815 per month.
[¶46.] Finally, in evaluating the child support award, it is important to note
that the trial court did not give Kevin an abatement or cross-credit on his child
12. However, in reaching this conclusion, we note that neither party is able to
unilaterally control the children’s standard of living, and consequently the
child support award. Specifically, Carmen cannot dictate the expenditure of
Kevin’s wealth for child support by spending money excessively. Similarly,
Kevin cannot deny his children the child support to which they are entitled
by being overly conservative with his finances, thus preventing his children
from receiving the benefit of his wealth. Instead, the ultimate decision as to
the appropriate child support obligation rests within the sound discretion of
the trial court.
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support obligation even though the children would be living with Kevin 50 percent
of the time. 13 This is significant because the obligations set forth in the child
support obligation schedule are typically applied to situations where one parent has
primary physical custody of the child(ren) and the other parent only has visitation.
Further, it is also important to note that Kevin will be paying substantially more
than $2,815 each month to cover other costs associated with the children. 14 In
addition to the monthly “base” payments of $2,815, the trial court ordered Kevin to
pay for health insurance for the children, 95 percent of AC-AS’s therapy costs, 95
percent of the supplemental costs associated with AC-AS’s special needs, 95 percent
of the children’s uncovered medical expenses, 95 percent of the nanny expenses
incurred until AC-AS entered preschool, and 95 percent of private school tuition (if
applicable).
[¶47.] According to Carmen’s own estimates, the additional expenses
associated with AC-AS’s special needs alone total approximately $15,800 per month
(making Kevin’s share of these expenses approximately $15,010). Consequently,
when taking into account both the “base” child support payment of $2,815 and the
13. Under the current version of SDCL 25-7-6.14, the trial court had discretion to
grant Kevin an abatement given that the children would be residing with
Kevin half of the time each month. This would have lowered Kevin’s child
support obligation by between 38 percent and 66 percent for the nights the
children stayed with Kevin. Further, SDCL 25-7-6.27 provides the trial court
with discretion to grant parties a cross-credit on the child support obligation
when certain conditions are met. Based on the mathematical formula
provided in SDCL 25-7-6.27, if the trial court had given Kevin a cross-credit,
his child support obligation would have been approximately $2,000 as
opposed to $2,815.
14. We acknowledge that Kevin’s payment of these additional expenses does not
go towards the maintenance of the children’s standard of living.
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additional payment of $15,010, Kevin will be paying more than $17,825 per month
in child support.
[¶48.] In this case, Carmen has failed to establish that the trial court’s child
support award was “not justified by, and clearly against, reason and evidence.” See
Hill, 2009 S.D. 18, ¶ 5, 763 N.W.2d at 822. Accordingly, the trial court did not
abuse its discretion in rejecting Carmen’s request for “base” child support of
approximately $9,200 per month and instead ordering Kevin to pay monthly “base”
child support of $2,815. As previously discussed, if the actual needs of either AC-AS
or AE-VS change in the future, the trial court has continuing jurisdiction to modify
the child support order pursuant to SDCL 25-7A-22 in order to meet the children’s
actual needs.
[¶49.] 5. Whether the trial court abused its discretion in dividing
the property by rejecting Carmen’s request for
reimbursement of $6,000 she claimed she paid Kevin.
[¶50.] When dividing property, “a trial court ‘is not bound by any
mathematical formula but shall make such award from the material factors before
[it] having due regard for equity and the circumstances of the parties.’” Grode v.
Grode, 1996 S.D. 15, ¶ 9, 543 N.W.2d 795, 800 (alteration in original) (quoting
Hanson v. Hanson, 252 N.W.2d 907, 908 (S.D. 1977)). In this case, the parties’
prenuptial agreement generally controlled the property division. Prior to trial,
Kevin paid Carmen $1 million of the $5 million total he owed her under the
prenuptial agreement. Therefore, at the time of trial Kevin still owed Carmen $4
million. At trial, the parties disputed whether Kevin was entitled to receive certain
offsets for payments Kevin believed he should be reimbursed for. Ultimately, the
trial court found that Kevin was entitled to an offset of $28,026.16 for expenses
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Carmen agreed she was responsible for paying. The trial court rejected Kevin’s
requests for other offsets totaling more than $300,000.
[¶51.] Additionally, at trial Carmen requested a credit for $6,000. Carmen
claimed she wrote a $6,000 check on the parties’ joint account, but then attempted
to stop payment on the check after Kevin requested that she no longer use their
joint account. Believing that her attempt to stop the check was unsuccessful,
Carmen claimed she paid Kevin $6,000 from her personal account to cover the
check. However, Carmen claims that when she later requested that the $6,000 be
returned because payment of the check had been stopped, Kevin refused. The trial
court denied Carmen’s request for a $6,000 credit. Carmen appeals this ruling.
[¶52.] A review of the record establishes that the trial court did not abuse its
discretion in dividing the property under the prenuptial agreement. The record
shows that the trial court considered the evidence presented by each party with
regard to the disputed property, and then divided the property. In doing so, the
trial court denied most of Kevin’s requests for offsets, and gave Carmen various
property despite Kevin’s objections. Overall, the record demonstrates that the
distribution of property was equitable.
[¶53.] Further, the trial court found that there was insufficient evidence to
support Carmen’s request for a credit of $6,000. The record supports this finding.
First, when Carmen was asked at trial about the cash she allegedly paid Kevin,
Carmen initially indicated the amount was $5,000, but later stated it was $6,000.
Next, it was unclear whether the $6,000 Carmen claimed she paid Kevin came from
her own personal account, or whether it was Kevin’s money. Finally, Carmen failed
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to provide any evidence, such as account statements, to support her testimony.
Therefore, the trial court did not err in finding the evidence was insufficient to
support Carmen’s claim. As a result, the trial court did not abuse its discretion in
dividing the property when it denied Carmen’s request for a credit of $6,000.
[¶54.] 6. Whether the trial court abused its discretion in denying
Carmen’s request for attorney fees of more than $370,000.
[¶55.] Generally, trial courts may award attorney fees in cases involving
divorce, support, or alimony. SDCL 15-17-38. A two-step analysis is used by courts
in determining whether to award attorney fees. Urbaniak v. Urbaniak, 2011 S.D.
83, ¶ 31, 807 N.W.2d 621, 628.
First, the court must determine what constitutes a reasonable
attorney’s fee. This requires consideration of (1) the amount and
value of the property involved, (2) the intricacy and importance
of the litigation, (3) the labor and time involved, (4) the skill
required to draw the pleadings and try the case, (5) the
discovery utilized, (6) whether there were complicated legal
problems, (7) the time required for the trial, and (8) whether
briefs were required. Second, it must determine the necessity
for such fee. That is, what portion of that fee, if any, should be
allowed as costs to be paid by the opposing party. This requires
consideration of the parties’ relative worth, income, liquidity,
and whether either party unreasonably increased the time spent
on the case.
Id. (quoting Edinger v. Edinger, 2006 S.D. 103, ¶ 17, 724 N.W.2d 852, 858).
[¶56.] In this case, Carmen requested that the trial court order Kevin to pay
her attorney fees of over $370,000. However, the trial court denied this request and
ordered the parties to pay their own attorney fees. In denying Carmen’s request for
attorney fees, the trial court considered the appropriate factors and specifically
found that each party had sufficient assets to pay his or her own attorney fees. The
fact that Kevin has more liquid assets than Carmen does not mean that Kevin is
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required to pay Carmen’s attorney fees. Further, the trial court found that Carmen
increased her own litigation costs by calling numerous experts, including some that
were cumulative and/or unpersuasive. Finally, the trial court found that Kevin did
not engage in conduct that increased Carmen’s costs. These findings were
supported by the record. Therefore, the trial court did not abuse its discretion in
denying Carmen’s request for attorney fees.
[¶57.] Additionally, both parties submitted motions for appellate attorney
fees in this case. Kevin requests appellate attorney fees and costs of $11,030.05.
Carmen requests appellate attorney fees and costs of $29,910.78. Upon
consideration of the factors described above, we conclude that neither party is
entitled to an award of appellate attorney fees. As a result, the parties’ motions for
appellate attorney fees are denied.
CONCLUSION
[¶58.] The trial court’s extensive amended findings of fact and conclusions of
law demonstrate that the trial court thoroughly reviewed the evidence and weighed
it accordingly. The amended findings of fact are supported by the record and are
not clearly erroneous. Furthermore, the trial court’s resolution of the issues
disputed by the parties is supported by the evidence. As a result, the trial court’s
decisions as to custody, child support, property division, and attorney fees were not
an abuse of discretion. Affirmed.
[¶59.] SEVERSON and WILBUR, Justices, concur.
[¶60.] KONENKAMP and ZINTER, Justices, concur in part and dissent in
part.
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KONENKAMP, Justice (concurring in part and dissenting in part).
[¶61.] In this case, the father earns a monthly income of better than
$176,000. Yet the trial court limited his child support payment to the guideline
amount for parents earning a combined monthly income of $20,000. With a single
sentence, the court rejected the mother’s entire budget: “The court discredits her
expenses as inflated, speculative, and unreliable.” No details were given on how, in
the court’s view, all the mother’s expenses were objectionable. Acting under the
misbelief that the tables in the child support schedule set the limit for gauging
standard of living, the court found that the mother “would be the driving force
behind setting a standard of living that is inconsistent with the guideline amounts.”
This was an error of law, as well as an abuse of discretion.
[¶62.] Our child support schedule, based on average family expenditures, is
only a starting point for high-income earners. No presumption exists in South
Dakota that the correct child support for high earners is the ceiling amount set out
in the schedule tables. On the contrary, “For a combined net income above the
schedule in § 25-7-6.2, the child support obligation shall be established at an
appropriate level, taking into account the actual needs and standard of living of the
child.” SDCL 25-7-6.9 (emphasis added). What measure, then, should be used to
determine the “appropriate level” of child support for parents earning
extraordinarily high incomes?
[¶63.] Certainly, in this type of case, it would be unsuitable to order child
support calculated purely by linear upward extrapolation from the income and
support amounts listed in the guidelines. Such an arbitrary method would have no
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necessary relationship to the children’s needs or standard of living, and might well
infringe upon the parents’ shared right to make lifestyle choices for their children.
When earnings exceed the guideline schedule, therefore, the Legislature left to the
courts the work of setting the “appropriate” child support, most likely because such
awards defy mathematical formulas. On the other hand, limiting the award to the
ceiling amount provided in the base schedule ignores the legislative command that
for higher level income the “child support obligation shall be established at an
appropriate level” considering needs in context with standard of living. See id.
(emphasis added). Since high-income families live well above subsistence levels,
both needs and standard of living must be considered in the parents’ distinctive
circumstances. Where high wealth is concerned, necessities and luxuries are
relative.
[¶64.] In affirming the child support award, this Court proclaims that trial
courts are not required to go above the guidelines, without considering the trial
court’s erroneous view of the law and the significant variance this case presents.
Little guidance can be gleaned from the cases the Court cites. In Bloom, the paying
parent earned something over $4,000 a month, 498 N.W.2d at 217; in Billion,
$7,000 a month, 1996 S.D. 101, ¶ 39, 553 N.W.2d at 235; and in Evans, $25,000 a
month, 1997 S.D. 16, ¶ 18, 559 N.W.2d at 244. But here the father’s income is not
simply off the charts — it dwarfs the earnings in those other cases. This parent
earns an extraordinary income, far beyond anything contemplated in the guidelines.
Yet the trial court capped the child support at the guideline amount for parents
earning a fraction of what the father earns here. In such circumstances, closer
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appellate review is required than merely incanting formulaic language about
discretion. And it certainly lends no weight to the Court’s decision that it declares
that the parents’ standard of living is “equivalent.” The father has holdings of sixty
million dollars and earns over $176,000 a month; the mother has something less
than five million and earns $8,756 a month. How does that compute to an equal
standard of living?
1. Standard of Living
[¶65.] Children should share in their parents’ standard of living. In
measuring standard of living for child support purposes, the test is not whether the
high-income payer chooses to live a frugal lifestyle, as the Court here seems to
suggest; the test is to determine the standard of living the children would have
enjoyed had it not been for the divorce. See Billion, 1996 S.D. 101, ¶ 41, 553
N.W.2d at 235 (citing Ochs, 538 N.W.2d at 531). That measure incorporates both
parents’ values. Indeed, our child support guidelines are premised on the belief
that children are entitled to the same level of expenditures they would have
received had the parents lived together and combined their financial resources. See
Report of the South Dakota Commission on Child Support (December 2008). And
the job of the trial court is to reconcile the critical tension between competing
parents to ascertain the appropriate standard of living.
[¶66.] In jurisdictions where these questions arise more frequently, courts
have embraced “the recognition that the appropriate standard of living for a child of
affluent parents is affluence matching that of the parents. . . .” Laura W. Morgan,
Child Support Guidelines Interpretation & Application § 8.07, Deviating from the
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Guidelines (2013). One parent cannot control the children’s standard of living. Id.
Seldom have we had occasion to examine child support for extremely high-income
earners such as here, but in cases where the income was well above the guidelines,
we have generally espoused a similar view. See Ochs, 538 N.W.2d at 531 (child can
“partake in some of his father’s high standard of living while he is with his
mother”); Evans, 1997 S.D. 16, ¶ 17, 559 N.W.2d at 244 (child support provided
“luxurious lifestyle” for the children).
[¶67.] It is always a matter of balance, of course, between setting an amount
that will care for the children’s actual needs and permit them to enjoy a standard of
living commensurate with what they would have had if the parents had not been
divorced. This does not mean that children must be supported at the highest
standard of living attainable by the parents’ income. 15 Overreaching in the name of
benefitting the children should be discouraged, but the notion that the parent
receiving child support should not benefit at all in the children’s standard of living
is simply unrealistic. When children share in the standard of living of both parents,
child support may appropriately improve the standard of living of the receiving
parent in order to improve the lives of the children. 16
15. This is sometimes called the “Three Pony Rule.” No child, no matter how
wealthy the parents, needs more than three ponies. In re Marriage of
Patterson, 920 P.2d. 450, 455 (Kan. Ct. App. 1996).
16. In re Marriage of Cheriton, 92 Cal. App. 4th 269, 294-95 (Cal. Ct. App. 2001);
Strahan v. Strahan, 953 A.2d 1219, 1225-26 (N.J. Super. Ct. 2008);
Nordstrom v. Nordstrom, 965 S.W.2d 575, 579-80 (Tex. Ct. App. 1997).
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[¶68.] As other courts have noted, child support should provide the receiving
parent with adequate resources to support the children in a lifestyle the parents
would have had if they remained together. See Nash v. Mulle, 846 S.W.2d 803, 805
(Tenn. 1993) (one of the primary goals of guidelines is to allow children of wealthy
parents to share in a very high standard of living); see also Bagley v. Bagley, 632
A.2d 229, 238 (Md. Ct. App. 1993) (children of affluent noncustodial parents are
entitled to benefits of affluent standard of living). Reasonable needs of affluent
children may include items that would be frivolous for children of less-well-off
parents. In re Marriage of Nimmo, 891 P.2d 1002, 1007 (Colo. 1995) (children
entitled to “fruits of one parent’s good fortune”). Where courts fail to account for a
high earner’s standard of living in setting child support, an abuse of discretion
occurs. 17
2. Additional Amounts
[¶69.] The Court makes much of the fact that the father must pay, in
addition to child support, ninety-five percent of the children’s expenses. But most of
these payments go toward the parents’ special-needs daughter. These costs include
supplemental expenses, such as therapy, her potential SEIT, nutritional
supplements, and possible private school tuition. Also, the father pays uncovered
17. See McGinley v. Herman, 50 Cal. App. 4th 936, 944-46 (Cal. Ct. App. 1996)
(reversing an award of $2,150 a month where the supporting parent’s
monthly income exceeded $116,000); In re Marriage of Hubner, 205 Cal. App.
3d 660, 667-69 (Cal. Ct. App. 1988) (trial court erred by awarding less than
one-half the discretionary guideline amount where the supporting parent’s
gross monthly income exceeded $43,000); In re Marriage of Catalano, 204
Cal. App. 3d 543, 552-53 (Cal. Ct. App. 1988) (error to award $1,110 a month
where the supporting parent’s gross monthly income was $32,000).
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medical costs, and the children’s health insurance. None of these amounts goes
toward the children’s standard of living. This Court also emphasizes that the
parents share custody of the children. Yet the father did not request any abatement
or cross-credit, and the circuit court specifically found that “[a]batement or shared
parenting cross-credit are discretionary and are not warranted under the facts of
this case.”
[¶70.] Considering the father’s income of over $176,000 a month and the
parents’ combined income of $185,000 per month, the child support award of $2,815
for two children was inadequate to provide for their needs and standard of living.
This matter should be reversed and remanded for a new determination of
“appropriate” child support based on the record and arguments of counsel. 18
ZINTER, Justice (concurring in part and dissenting in part).
[¶71.] I concur on all issues except the matter of child support. On that issue,
I join Justice Konenkamp’s dissent.
[¶72.] I write to explain the trial court’s error in calculating the base child
support. In its analysis, the court first noted the disparity in the parties’ incomes.
Because of that disparity, the court indicated that the base support obligation would
be prorated, with Kevin being responsible for ninety-five percent. The court also
indicated that the base support obligation would be based on both “the actual needs
and standard of living for the minor children[.]” Amended Finding of Fact 141.
18. Reasonable appellate attorney’s fees should be awarded to the mother in
connection with this issue.
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[¶73.] But the court erred as a matter of law in then determining the base
obligation to prorate. 19 The court determined that “in order to provide for the
children’s actual needs and standard of living,” the base obligation should be the top
scheduled amount for two children in the support obligation table. Amended
Finding of Fact 142. See also SDCL 25-7-6.2. Although the Schieffers’ joint income
was approximately $185,000 per month, the top scheduled amount only applied to
parents with joint monthly income of $20,000. See SDCL 25-7-6.2. Nevertheless,
the court believed that the top scheduled amount was appropriate because it
“accurately estimates the actual needs and standard of living for the minor
children.” Amended Finding of Fact 142. The court believed that the top scheduled
amount included the “typical” needs of children. Id. However, the needs and
standard of living of children with parents earning $185,000 per month are not
19. As the majority notes, in addition to paying his share of the base obligation,
Kevin was ordered to pay his pro rata share of the cost associated with the
special needs of his daughter. The court also required Kevin to pay his pro
rata share of both children’s medical insurance, uninsured medical expenses,
and child care. This additional support is substantial. But the majority
incorrectly concludes that this additional support justifies the trial court’s
determination of the base support obligation.
The base child support obligation is calculated in accordance with SDCL 25-
7-6.2. Support for special needs is awardable under SDCL 25-7-6.10.
Medical and child care support is awardable under SDCL 25-7-6.16 and 6.18.
The support awardable under the latter three statutes is support in addition
to the base support awardable under SDCL 25-7-6.2. The trial court correctly
awarded the additional support. But the award of additional support for the
specific costs addressed in SDCL 25-7-6.10, 6.16, and 6.18 does not cure a
trial court’s erroneous determination of the base support under SDCL 25-7-
6.2. That is because the costs of special needs, medical insurance,
unreimbursed medical expenses in excess of $250, and child care are not
factored into the scheduled amounts required to be paid for base support.
Report of the South Dakota Commission on Child Support (Dec. 2008).
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typical; and the top scheduled amount is not based on the actual needs and
standard of living of children with parents having the Schieffers’ income.
[¶74.] The base obligations in the guidelines are based on economic data
reflecting the different cost of raising children in households as monthly incomes
increase up to $20,000. 20 The guidelines do not consider any economic data
reflecting the cost of raising children in households with incomes above the top
scheduled amount of $20,000. Therefore, the court erred as a matter of law in
determining that the top scheduled amount reflected the actual needs and standard
of living of the Schieffers’ children. The Schieffers’ income was nine times greater
than the income used to determine the top scheduled amount. Simply stated, the
top scheduled amount does not purport to reflect the base obligation necessary to
20. The majority errs in focusing on the age of the children at the time of the
divorce (AE-VS being two years old) and then postulating that “[i]f AE-VS’s
needs change as he ages, as is expected, the trial court will have discretion to
correspondingly raise the support obligation to meet those needs[.]” Majority
Opinion ¶ 40 (citing SDCL 25-7A-22 (allowing for a modification of support
based on a substantial change in circumstances)). See also ¶ 44. The “change
in circumstances” prerequisite for modifying support “survived the
legislature’s” adoption of child support guidelines in 1989. Whalen v. Whalen,
490 N.W.2d 276, 281 (S.D. 1992). See also SDCL 25-7A-22. But the aging of
children is generally not a change in circumstances authorizing the
modification of support. The majority fails to recognize that, since the
guidelines’ inception, base support has included the “average annual cost of
raising the child to age 18.” Report of the South Dakota Commission on
Child Support 14 (Dec. 1985). Therefore, the increased cost of raising a child
as the child ages is generally not a change in circumstances because it is
already factored into the guidelines. In this case, the trial court selected a
base support obligation from the table that included the increasing cost of
raising children as they age. The majority is wrong in assuming that the
trial court has discretion to periodically increase the base support obligation
based solely on the increasing needs of children as they age.
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provide for the needs and standard of living of children whose parents have a
combined income of $185,000 per month. 21
21. The trial court also erred as a matter of law in finding that “Carmen has
failed to prove that additional deviation from the child support guidelines is
necessary to serve the children’s actual needs and standard of living.”
Amended Finding of Fact 156. Deviations from the scheduled amount are
governed by SDCL 25-7-6.10. Carmen did not seek a deviation from the
schedule under this statute. Carmen sought a larger base child support
award for divorcing parties whose combined income was not covered by the
schedule.
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