Alexander Nikolayev v. Natalia Nikolayev

FOR PUBLICATION
APPELLANT PRO SE: Feb 28 2013, 9:26 am
ALEXANDER NIKOLAYEV
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
ALEXANDER NIKOLAYEV, )
)
Appellant-Respondent, )
)
vs. ) No. 49A05-1207-DR-372
)
NATALIA NIKOLAYEV, )
)
Appellee-Petitioner. )
APPEAL FROM THE MARION SUPERIOR COURT
The Honorable Cynthia Ayers, Judge
The Honorable Deborah Shook, Master Commissioner
Cause No. 49D04-0901-DR-2720
February 28, 2013
OPINION - FOR PUBLICATION
PYLE, Judge
STATEMENT OF THE CASE
Alexander Nikolayev (“Alexander”) appeals the trial court’s child support and
property division orders in the dissolution of his marriage to Natalia Nikolayev
(“Natalia”). The trial court entered the orders, which include findings of fact and
conclusions of law, after this Court remanded the matter for further findings in an
unpublished opinion, Nikolayev v. Nikolayev, No. 49A05-1108-DR-393 (Ind. Ct. App.
May 21, 2012).1
We affirm.
ISSUES
1. Whether the trial court erred as a matter of law in determining that
the money Alexander voluntarily contributed to his 401(k) account
should be included as income for purposes of determining child
support; and
2. Whether the trial court erred in holding a hearing and subsequently
valuing Natalia’s household goods and personal property for
purposes of determining the division of marital property.
FACTS AND PROCEDURAL HISTORY
The facts pertinent to this appeal were stated in our previous unpublished opinion
as follows:
Alexander and Natalia were married in November 2001, and they had one
child during the marriage, V.N., who was born in 2003. Alexander, who
has a Master’s Degree in science from the former Soviet Union, immigrated
1
Natalia did not file an appellee’s brief in this matter. “When an appellee fails to submit a brief, we do
not undertake the burden of developing an appellee’s arguments, and we apply a less stringent standard of
review, that is, we may reverse if the appellant establishes prima facie error.” Zoller v. Zoller, 858
N.E.2d 124, 126 (Ind. Ct. App. 2002). “However, we review de novo questions of law, regardless of the
appellee’s failure to submit a brief.” McClure v. Cooper, 893 N.E.2d 337, 339 (Ind. Ct. App. 2008).
2
to the United States from Russia in 1992. He began working for a
pharmaceutical company within a few months of arriving in America. In
2002, he secured employment with Eli Lilly & Company (“Lilly”) and
currently earns over $100,000 per year, including bonuses.
****
At the end of 2008, Natalia moved out of the marital residence. She used
$7,000 to $8,000 she had received from recent art restoration work she had
done, along with some funds received from her older son [from a previous
marriage] and sister, to establish a separate household, including renting an
apartment and buying furniture, utensils, and linens. Natalia also used
some the money to pay a consultation and retainer fee to an attorney for
divorcing Alexander.
It appears that one of the primary motivations Natalia had for leaving
Alexander was her belief that he was too controlling with respect to
finances. For example, between 2002 and 2008, Alexander consistently
received raises and bonuses from Lilly to the point where he was earning
over $100,000 annually. However, the available income to the Nikolayev
family remained constant during this time, because Alexander directed that
any additional amount earned through raises be saved and/or diverted to his
voluntary 401(k) account through Lilly, and the money was not spent on
current family expenses. By 2010, Alexander was contributing over $1,700
per month to his 401(k). The net effect of these 401(k) and savings
contributions was that the amount available for current family expenses
remained constant at approximately $51,000 per year throughout the
marriage.
Alexander did not allow Natalia to have a credit card until near the end of
the marriage, and even then he would review every expense she charged to
it and would take the card away if he did not approve of it. According to
Natalia, the marital home was sparsely furnished, they slept on a thin
mattress on the floor for about year after buying the home, and they had no
cell phones, cable TV, or a washing machine; Natalia had to do laundry at a
nearby apartment complex. Natalia indicated that Alexander had a
“[S]oviet . . . mentality” toward finances that she did not believe was in
V.N.’s best interests and said that Alexander’s reluctance to spend any
money on things like ice cream at the zoo or going out to eat made things
“miserable.”
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** **
Alexander argued [at the dissolution hearing] that . . . his income should be
calculated only after deducting the 401(k) contributions he had been
regularly making during the marriage . . . .
Slip Op. at 1-2.
The trial court entered findings of fact and conclusions of law in support of its
dissolution order; however, this Court determined that the trial court failed to make any
findings to support its decision to include Alexander’s 401(k) contributions as part of his
income for purposes of calculating his child support obligation. Accordingly, we
remanded with instructions that the trial court issue findings on the issue. Slip Op. at 8-9.
With reference to the value of Natalia’s household goods/personal property, the
trial court also found that “[Alexander] had household goods with a value of $1,000.00
and [Natalia] had household goods with a value of $300 at the time of separation.” Slip
Op. at 15. This Court determined that the trial court’s finding was “clearly erroneous.”
Id. We remanded to the trial court with instructions that the trial court consider
“purchases Natalia made after she moved out of the marital residence but before the date
of final separation, to include that property as marital property, and recalculate the total
value of the marital estate.” Id.On remand, the trial court held a hearing to clarify what evidence had been
submitted and to determine the fair market value of the household goods/personal
property. On June 26, 2012, it issued its “Findings of Fact and Conclusions Thereon.”
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(App. 15). With regard to the money Alexander voluntarily contributed to his 401(k), the
trial court made the following findings:
1. [Alexander] controlled all the finances in the parties’ household.
2. [Natalia] was required to give [Alexander] paychecks she received for her
earnings.
3. [Alexander] made all decisions of whether or in what amount retirement
contributions were made to his 401(k).
4. [Alexander] increased his contribution throughout the parties’ marriage,
maintaining the same household income of approximately $51,000.00 over
the 7 years of the marriage.
5. Over the 7 years of the parties’ marriage, [Alexander] accumulated
substantial funds in his 401(k).
6. Contributions to [Alexander’s] 401(k) are not mandatory.
7. [Alexander’s] income increased to over $100,000.00 per year, but because
of the increasing contributions to the 401(k), the household income did not
increase.
8. [Alexander’s] contributions to his 401(k) were increased during the
pendency of this case.
9. [Natalia] had no control over the amounts of [Alexander’s] continued
voluntary contributions to his 401(k).
10. [Alexander] continued to maintain the household income level at
approximately $51,000.00 per year, despite his income level increasing
steadily and substantially during his marriage and employment at Eli Lilly.
11. [Alexander’s] 401(k) savings benefitted the intact family in increased credit
worthiness and benefitted the family as it provided available funds in the
event withdrawals were necessary. With the family no longer intact, the
401(k) contributions, if not considered income for purposes of child
support, will no longer benefit the parties’ child as it did during the
marriage.
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12. [Alexander’s] base income is regular and consistent and contributions to his
401(k) are voluntary.
13. [Alexander’s] voluntary contributions have increased to $1,715.99 per
month and he continued to withhold any income received from his
substantial increases in income from being used throughout the parties’
marriage.
14. These contributions are pre-tax contributions from his income.
15. The Indiana Child Support Guidelines advocate a “total income approach”
to calculating weekly gross income for the purposes of calculating a
parent’s child support obligation. Child Support Guideline 1.A.1.
16. All monies contributed to the 401(k) by [Alexander] are actual income he
receives as compensation for his employment at Eli Lilly.
17. The calculation of a parent’s income for child support purposes is more
inclusive than for income tax purposes. Bass v. Bass, 779 N.E.2d 582, 593
(Ind. Ct. App. 2002), trans. denied.
18. Weekly gross income for child support calculations is broadly defined to
include not only actual income from employment but also potential income
and imputed income from in-kind benefits. Ratliff v. Ratliff, 804 N.E.2d
237, 245 (Ind. Ct. App. 2004).
19. This is not a modification of support issue, but rather determination of the
appropriate child support order after a final hearing.
20. Public policy considerations embodied in the Child Support Guidelines
such as the “total income approach,” imputed income and the use of
potential income in calculating a parent’s gross income for purposes of a
child support calculation, point toward the inclusion of income, not the
exclusion of it.
21. [Alexander’s] argument that he has withheld this income from the family
consistently and therefore it should not be included in his income does not
comport with public policy or the intent of the Indiana Child Support
Guidelines.
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22. [Alexander’s] incentive to make substantial voluntary contributions to his
401(k) was to maintain control over the funds.
23. All [Alexander’s] voluntary 401(k) contributions which are based upon his
actual income will be considered as income for the purpose of calculating
his child support obligation. [Alexander’s] child support obligation
remains calculated at $186.00 per week, effective July 8, 2011.
(App. 15-18) (emphasis in original).
With regard to the distribution of marital assets issue, the trial court issued its June
27, 2012 “Order on Hearing Regarding Personal Property.” (App. 20). In pertinent part,
the trial court found that Natalia had in her possession “an additional Two Thousand
Dollars ($2,000) of personal property for a total of Two Thousand Three Hundred Dollars
($2,300.00) personal property on the date of filing . . . [Alexander] may deduct Eight
Hundred Dollars ($800.00) from the last One Thousand Dollar ($1,000.00) payment due
[to Natalia].” (App. 20-21).
Alexander now appeals.
DISCUSSION AND DECISION
1. Child Support
Alexander argues that the trial court erred in including the money he voluntarily
contributes to his 401(k) as income for purposes of determining child support. In
reviewing findings made pursuant to Indiana Trial Rule 52, we first determine whether
the evidence supports the findings and then whether the findings support the judgment.
In re Paternity of K.I., 903 N.E.2d 453, 457 (Ind. 2009). On appeal, we “shall not set
aside the findings or the judgment unless clearly erroneous, and due regard shall be given
7
to the opportunity of the trial court to judge the credibility of the witnesses.” Id.(quoting Ind. Trial Rule 52(A)). We will not reweigh the evidence and will consider only
the evidence favorable to the trial court’s judgment. Allen v. Proksch, 832 N.E.2d 1080,
1099 (Ind. Ct. App. 2005). Findings are clearly erroneous only when the record contains
no facts to support them “either directly or by inference.” Id. A judgment is clearly
erroneous when there is no evidence supporting the findings or the findings fail to
support the judgment. In re K.I., 903 N.E.2d at 457. In order to determine that a finding
or conclusion is clearly erroneous, we must come to the firm conviction that a mistake
has been made. Allen, 832 N.E.2d at 1099. However, “while we defer substantially to
findings of fact, we do not do so to conclusions of law.” Carmichael v. Siegel, 754
N.E.2d 619, 625 (Ind. Ct. App. 2001). A judgment is also clearly erroneous under
Indiana Trial Rule 52 if it is based on an incorrect legal standard. Id. “We evaluate
questions of law de novo and owe no deference to a trial court’s determination of such
questions.” Id.Here, Alexander does not dispute the trial court’s finding that his income is regular
and consistent and contributions to his 401(k) are voluntary. He also does not dispute the
trial court’s finding that all money contributed to his 401(k) is income he receives as
direct compensation for his employment at Eli Lilly. Furthermore, Alexander does not
dispute the trial court’s findings that his voluntary contributions have increased to
$1,715.99 and that he continues to maintain the household income level at approximately
half of his salary and regular bonuses.
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Instead, Alexander disputes the trial court’s application of the law to the facts.
Specifically, he argues that the trial court’s judgment fails to consider the standard of
living V.N. would have enjoyed if the marriage had not been dissolved. He cites Indiana
Code § 31-16-6-1; Thompson v. Thompson, 868 N.E.2d 862 (Ind. 2007); and Saalfrank v.
Saalfrank, 899 N.E.2d 671, 680 (Ind. Ct. App. 2008) in support of his argument.
Indiana Child Support Guideline 1 advocates an “income shares model” that “is
predicated on the concept that the child should receive the same proportion of parental
income that he or she would have received if the parents lived together.” The basic
support obligation is determined by using the weekly gross income of the parent.
Commentary to Guideline 1. Guideline 3 mandates that weekly gross income includes
“income from any source,” including income from salaries, wages, and bonuses. As the
trial court determined, the term weekly gross income for support calculation is based
upon a “total income approach” that generally points toward the “inclusion of income,
not the exclusion of it.” See App. 17-18. The guideline approach is promulgated in
Indiana Code § 31-16-6-1(a), which considers, among other things, the standard of living
the child would have enjoyed if the marriage had not been dissolved and the financial
resources and needs of the noncustodial parent.
It is true, as Alexander argues, that the guidelines and Indiana Code § 31-16-6-1(a)
consider the standard of living the child would have enjoyed if the marriage had not been
dissolved. However, that standard is measured by the parent’s weekly gross income for
purposes of determining child support, and it is not the parent’s prerogative to decrease
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the amount of weekly gross income for determining child support by his decision to
invest part of the income. In short, the trial court did not err in ordering that the entire
amount of Alexander’s salary and regular bonuses be treated as weekly gross income for
purposes of determining his child support obligation.
The Saalfrank case does not alter our determination. In Saalfrank, this Court
emphasized that voluntary contributions should be included as weekly gross income for
child support purposes while certain mandatory contributions should not. See, 899
N.E.2d at 680.2
2. Marital Property
Alexander contends that the trial court erred in holding a hearing upon remand and
determining the fair market value of property acquired by Natalia after she moved out of
the marital residence but before the date of final separation two months thereafter.
Alexander argues that the trial court improperly determined that the household
goods/personal property purchased by Natalia could have depreciated from his estimated
value of approximately $6,000.00 to the $2,000.00 determined by the trial court.
Our remand to the trial court included the following specific instructions:
It does appear that Natalia clearly purchased a significant amount of
personal property in the month or two leading up to the filing of the
dissolution petition, well in excess of $300 worth. On the other hand, the
trial court is not required to blindly accept Alexander’s assertion of how
much personal property/household goods Natalia purchased before the
filing of the petition. It is, however, required to consider purchases before
2
The Thompson case, which discusses the availability of a credit for Social Security benefits received by
the child, is inapposite.
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the date of final separation, to include that property as marital property, and
recalculate the total value of the marital estate.
Slip Op. at 15.
In this appeal, it appears that the trial court held a hearing to help it determine
what household goods/personal property Natalia had purchased and their fair market
value at the time of the final separation. Our remand neither required nor prohibited the
trial court from holding an additional hearing to clarify the values of the property at issue.
Unfortunately, only a portion of the hearing was recorded. However, it is clear from the
recorded portions of the hearing that the trial court was attempting to determine the fair
market value of the household goods/personal property purchased by Natalia. It is
apparent that the trial court heard relevant argument or received relevant evidence during
the unrecorded portion of the hearing.
In order to challenge the trial court’s findings on this issue, Alexander should have
created a verified statement of the evidence from the best sources and then obtained
certification of the statement by the trial court under Indiana Rule of Appellate Procedure
31. This statement would have enabled this Court to conduct an informed review of all
of the evidence before the trial court. Alexander’s failure to comply with Appellate Rule
31 results in waiver of the issue on appeal. See, Graddick v. Graddick, 779 N.E.2d 1209,
1210-11 (Ind. Ct. App. 2002).
Affirmed.
ROBB, C.J., and MAY, J., concur.
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