Tina Carmer v. Scott Carmer

Oct 30 2015, 10:28 am
ATTORNEY FOR APPELLANT ATTORNEY FOR APPELLEE
Donna Jameson Stephen R. Lewis
Greenwood, Indiana Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Tina Carmer, October 30, 2015
Appellant-Respondent, Court of Appeals Case No.
49A05-1411-DR-539
v. Appeal from the Marion Superior
Court
Scott Carmer, The Honorable Patrick L.
Appellee-Petitioner McCarty, Judge
Trial Court Case No.
49D03-1401-DR-619
Mathias, Judge.
[1]   Tina and Scott Carmer’s marriage was dissolved in the Marion Superior Court.
Tina appeals the dissolution decree raising five issues, which we consolidate
and restate as:
I. Whether the trial court abused its discretion when it failed to include
Scott’s annuity income in the child support calculation;
II. Whether the trial court erred in interpreting the parties’ prenuptial
agreement and deviating from that agreement; and
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III. Whether the trial court abused its discretion in its division of the
marital liabilities.
[2]   We affirm in part, reverse in part, and remand for proceedings consistent with
this opinion.
Facts and Procedural History
[3]   Tina and Scott were married in 1994, and three children were born to the
marriage. The parties’ oldest child is emancipated.
[4]   Prior to the marriage, in 1988, Scott, who was a teenager at the time, was
severely injured in an automobile accident. He suffered a brain injury, walks
with a limp, and cannot use one of his arms. Monthly annuity payments from a
structured settlement agreement are his main source of income. Scott also
works as a greeter at Walmart and earns approximately $450 per week.
[5]   Tina was not employed during the marriage but stayed home to raise the
parties’ children. Tina and Scott were also raising two foster children in their
home and planned to adopt the children. After filing a petition to dissolve the
marriage, Scott stated that he no longer wanted to adopt the children. Tina
would like to adopt the children, but they were removed from her care after
Child Protective Services (“CPS”) was contacted regarding the condition of her
home. Specifically, Tina allowed the family’s pets to urinate and defecate in the
house and did not clean up after the animals. Tina participated in services
offered by CPS and is still attempting to adopt the children.
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[6]   The parties entered into a prenuptial agreement on the day they were married.
The agreement provides in pertinent part:
In the event of a dissolution of the marriage or of a divorce, Wife
agrees to accept in full and final settlement and satisfaction of all
rights claims and interest that she may have whether by way of a
division of the property of one or both of the parties (or alimony
or a property settlement as it is sometimes referred to), and in
every other way to the fullest extent permitted by law, of
alimony, maintenance, rehabilitative maintenance, support or
financial benefit of every kind.
(a) Wife’s separate property, and
(b) One half (1/2) of all jointly held property, subject to one half
(1/2) of all indebtedness thereon, including without limitation,
mortgages and taxes; and
(c) The following sums dependent upon the time of the
commencement of the action: . . . If the date of the
commencement of the action is: . . . more than 14 years [of the
date of the marriage] Wife shall receive the total sum of: $70,000.
Ex. Vol., Petitioner’s Ex. 2.
[7]   The parties own two homes, the marital residence and a rental property (the
former marital residence), and several vehicles. They also have significant credit
card debt, a loan on one of the vehicles, and mortgages on the real estate.
During the marriage, the residences were refinanced on multiple occasions to
assist in paying the parties’ debts.
[8]   Throughout the marriage, Tina was in charge of the parties’ finances. The
parties incurred a significant amount of debt, and Tina admitted the family
lived beyond their means. Scott periodically received lump sum payments from
his structured settlement agreement totaling $350,000 in addition to the
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monthly annuity payments. Nearly all of those funds were spent during the
marriage. In 2013, Scott received a $150,000 lump sum payment. When the
parties’ separated, only $80,000 remained in the parties’ bank account.
[9]   Scott filed the petition for dissolution of marriage on January 10, 2014. He also
filed a petition to enforce the parties’ prenuptial agreement. The dissolution
hearing was held on October 10, 2014, and the dissolution decree was issued on
November 6, 2014. The decree provides in pertinent part:
5. The Petitioner shall pay Respondent the sum of One Hundred
Fifty-One Dollars ($151.00) per week as child support for the
parties’ two minor children.
6. The aforementioned child support order is based on
Petitioner’s income from Walmart and the imputation of
minimum wage to the Respondent. Given the fact that the
Petitioner is presently not exercising overnights with the children
he is given no overnight credit.
7. The child support order does not include any sums received by
the Petitioner from his structured settlement by virtue of the
Structured Settlement Protection Act and Section 104(a)(2) of the
Internal Revenue Code which states: “gross income does not
include . . . the amount of any damage received (whether by suit
or agreement and whether as lump sums or as periodic payments
on account of personal injuries or sickness.)”
***
13. The Respondent managed the parties’ monies during their
marriage.
14. The Respondent testified that all lump sum payments made
to the Petitioner during the marriage from his annuities in the
total sum of Three Hundred Fifty Thousand Dollars ($350,000)
have been spent.
15. The Respondent shall receive all right, title and interest in the
following vehicles: the Dodge, the Legacy and the Econoline van
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which were titled in Petitioner’s name and purchased with
proceeds from his structured settlement. The vehicles are valued
at Nine Thousand Three Hundred One Dollars ($9301.00), One
Thousand Nine Hundred Thirty-Four Dollars ($1934.00) and
One Thousand Two Hundred Twenty-Five Dollars ($1,225.00)
respectively. The Petitioner shall receive credit for those sums as
a deduction from the lump sum payment due to Respondent
pursuant to the terms of the Prenuptial. . . .
***
18. The Respondent shall receive all right, title and interest to her
clothing and personal effects and the personal property in the
marital residence excluding the kitchen appliances and window
coverings. The furniture, pursuant to the terms of the Prenuptial,
is deemed to be the property purchased by the Petitioner since
the Respondent offered no evidence that she purchased the
furniture from an account in her name alone. As a result, the
Petitioner shall receive credit for the value of the furniture in the
sum of Five Thousand Dollars ($5,000.00) as a deduction from
the lump sum payment owed to Respondent pursuant to the
terms of the Prenuptial.
***
37. Petitioner introduced testimony and numerous exhibits
substantiating the depreciation to the residence from the urine
and feces damage done by Respondent’s pets after Petitioner left
the residence. The Respondent refuses to remove the pets from
the residence.
***
42. Respondent shall leave the marital residence in “for sale”
condition (clean without any additional waste).
43. Petitioner shall sell the marital residence. Any net equity after
payment of the mortgages, realtor’s fees, closing costs and any
principal payments paid on the mortgages by the Petitioner
during the pendency of this matter, shall be split (should any
exist).
44. Any reasonable repairs or damages resulting from
Respondent’s waste to the property required to be done for the
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residence to be sold shall be deducted from Respondent’s portion
of the proceeds as shall any depreciation to the residence
referenced in the purchase price of Two Hundred Ninety Nine
Thousand Dollars ($299,000.00) less the sale price.
45. The parties’ prenuptial provided for a payment to Respondent
of Seventy Thousand Dollars ($70,000) after 14 years of
marriage.
46. From this sum all payments for repairs and depreciation
referenced in paragraph 42 [concerning the marital residence],
should the residence be sold at a loss, shall be deducted and
considered Respondent’s dissipation of marital assets.
47. In addition so should the costs of attorney’s fees and
investigator’s fees of Fifteen Thousand Dollars ($15,000.00) paid
by Respondent from Petitioner’s Structured Settlement Proceeds
for the adoption of two children the Respondent lost custody of
due to her negligence pursuant to a Court Order of the Marion
County Juvenile Court. Respondent’s loss of custody resulted
from her lack of care of the children, the condition of the marital
residence and its effect on the children which the Respondent
allowed to occur when the children and the house were in her
sole custody. As a result this was a dissipation of the marital
assets.
48. In addition, there should be a deduction from the Seventy
Thousand Dollars ($70,000.00) for the value of the furniture,
Five Thousand Dollars ($5,000.00) and for the value of the
automobiles referenced above, Twelve Thousand Four Hundred
Sixty Dollars ($12,460.00) for a total of Seventeen Thousand
Four Hundred Sixty Dollars ($17,460.00).
49. The remainder of the Seventy Thousand Dollars
($70,000.00), should there be any, shall be paid immediately [to]
Respondent by the Petitioner upon closing of the marital
residence (substantiation the loss or gain).
Appellant’s Amended App. pp. 9-13. Tina appeals the dissolution decree.
Additional facts will be provided as needed.
Standard of Review
[10]   The trial court entered findings of fact and conclusions of law pursuant to
Indiana Trial Rule 52(A), and therefore, we apply a two-tiered standard of
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review for clear error; that is, first, we determine whether the evidence supports
the findings, and second, whether the findings support the judgment. Mysliwy v.
Mysliwy, 953 N.E.2d 1072, 1075-76 (Ind. Ct. App. 2011) (citations omitted),
trans. denied. We do not reweigh the evidence but consider the evidence
favorable to the judgment. Id. Findings of fact are clearly erroneous when the
record contains no facts to support them, and a judgment is clearly erroneous if
no evidence supports the findings, the findings fail to support the judgment, or
if the trial court applies an incorrect legal standard. Bowyer v. Ind. Dep't of
Natural Res., 944 N.E.2d 972, 983-84 (Ind. Ct. App. 2011). Although we review
findings under the clearly erroneous standard, we review conclusions of law de
novo. Id. at 983.
Child Support Calculation
[11]   Tina argues that the trial court erred when it failed to consider Scott’s annuity
payments under the structured settlement agreement as income when
calculating his child support obligation. A trial court's calculation of child
support is presumptively valid, and as such, we will reverse only where the
determination is clearly erroneous or contrary to law. Young v. Young, 891
N.E.2d 1045, 1047 (Ind. 2008).
[12]   Indiana Child Support Guideline 1 provides that child support should be
calculated to reflect the standard of living the children would have enjoyed had
the marriage not been dissolved. Child Support Guideline 3(A) defines weekly
gross income broadly and states in pertinent part:
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“weekly gross income” is defined as actual Weekly Gross
Income of the parent if employed to full capacity, potential
income if unemployed or underemployed, and imputed income
based upon “in-kind” benefits. Weekly Gross Income of each
parent includes income from any source, except as excluded
below, and includes, but is not limited to, income from salaries,
wages, commissions, bonuses, overtime, partnership
distributions, dividends, severance pay, pensions, interest, trust
income, annuities, capital gains, social security benefits,
workmen's compensation benefits, unemployment insurance
benefits, disability insurance benefits, gifts, inheritance, prizes,
and alimony or maintenance received from other marriages.
Social Security disability benefits paid for the benefit of the child
must be included in the disabled parent’s gross income. The
disabled parent is entitled to a credit for the amount of Social
Security disability benefits paid for the benefit of the child.
[13]   In its calculation of his weekly gross income, the trial court did not include the
$6,500 monthly payments Scott receives from his Structured Settlement
Agreement. See Ex. Vol., Petitioner’s Ex. 1. The trial court declined to include
these funds in its calculation of Scott’s weekly gross income:
by virtue of the Structured Settlement Protection Act and Section
104(a)(2) of the Internal Revenue Code which states: “gross
income does not include . . . the amount of any damage received
(whether by suit or agreement and whether as lump sums or as
periodic payments on account of personal injuries or sickness.)”
Appellant’s App. p. 9.
[14]   However, the Indiana Child Support Guidelines provide a broader definition of
income than the Internal Revenue Code. See Commentary to Ind. Child Supp.
G. 3(A) (explaining that “in calculating weekly gross income, it is helpful to
begin with total income from all sources. This figure may not be the same as
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gross income for tax purposes”); Harris v. Harris, 800 N.E.2d 930, 939 (Ind. Ct.
App. 2003) (stating “the definition of ‘weekly gross income’ is broadly defined
to include not only actual income from employment, but also potential income
and imputed income from ‘in-kind’ benefits”), trans. denied. Scott’s settlement
funds benefitted the family during the marriage and would have continued to
benefit the family had it remained intact.
[15]   In Knisely v. Forte, 875 N.E.2d 335, 340 (Ind. Ct. App. 2007), our court held that
payments for personal injury may be included in the gross weekly income
calculation. Also, Guideline 3(A) includes income from annuities in the
definition of weekly gross income. While structured settlement payments are
not specifically included in the Guidelines’ definition of gross income, both
annuities and structured settlement payments are certain sums of money paid
periodically or yearly. See Black’s Law Dictionary 1582 (10th ed. 2014)
(defining a structured settlement as a party’s agreement to pay periodic sums to
the opposing party for a specified time or “those which provide for an initial
cash payment followed by deferred payments in future years, normally on some
annuity basis”).
[16]   For these reasons, we conclude that the trial court erred when it failed to
include Scott’s structured settlement payments in its calculation of his weekly
gross income. We therefore remand this case to the trial court to include the
structured settlement payments in its calculation of Scott’s gross income or to
provide justification for deviating from the Guidelines if the court declines to do
so. See Commentary to Child Supp. G. 3(B) (stating “[w]hen the court deviates
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from the Guideline amount, the order or decree should also include the reason
or reasons for the deviation”).
[17]   Tina also argues that the trial court erred when it failed to address her request
for child support retroactive to the date Scott filed the petition for dissolution. It
is within the trial court’s discretion to retroactively apply a child support award
back to the date of filing or any date thereafter. See Haley v. Haley, 771 N.E.2d
743, 752 (Ind. Ct. App. 2002). On remand, we also direct the trial court to enter
a finding concerning whether its child support order should be retroactive to the
date of filing.
Prenuptial Agreement
[18]   Next, Tina argues that the trial court deviated from the parties’ prenuptial
agreement when it reduced the $70,000 payment payable to Tina under
paragraph nine of that agreement.1
Antenuptial agreements are legal contracts which are entered into
prior to marriage which attempt to settle the interest each spouse
has in property of the other, both during the marriage and upon
its termination. This court has long held antenuptial agreements
to be valid contracts, as long as they are entered into freely and
without fraud, duress, or misrepresentation, and are not
unconscionable.
Rider v. Rider, 669 N.E.2d 160, 162 (Ind. 1996). Neither party argues that their
prenuptial agreement is invalid.
1
The interpretation of a contract is primarily a question of law for the court and is reviewed de novo. Boetsma
v. Boetsma, 768 N.E.2d 1016, 1020 (Ind. Ct. App. 2002), trans. denied.
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[19]   The prenuptial agreement provided that if the parties were married for more
than fourteen years before the marriage was dissolved, Tina was entitled to her
separate property, one half of “all jointly held property, subject to one half (1/2)
of all indebtedness thereon,” and a $70,000 payment from Scott. Ex. Vol.,
Petitioner’s Ex. 2. The trial court awarded Tina $70,000 as provided in the
parties’ agreement. See Appellant’s App. p. 13.
[20]   The parties’ only significant joint property was the martial residence and the
former marital residence, which they maintained as a rental property. As agreed
to by the parties in paragraph 9 of the prenuptial agreement, the trial court
ordered the parties to sell both properties and to equally split the proceeds of the
sales after payment of the mortgages, realtor’s commissions, and closing costs.
[21]   Yet, Tina claims that the trial court impermissibly modified the parties’
agreement when it ordered that reasonable repairs required to be made to the
marital residence prior to sale due to Tina’s dissipation of the residence would
be deducted from her “portion of the proceeds as shall any depreciation to the
residence referenced in the purchase price of Two Hundred Ninety Nine
Thousand Dollars ($299,000.00) less the sale price.” Appellant’s App. pp. 12-
13. The parties’ prenuptial agreement does not contain any provision
addressing dissipation of martial assets. Therefore, the trial court did not
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modify the parties’ prenuptial agreement by holding Tina responsible for the
damage she caused to the marital residence resulting in its diminished value.2
[22]   Prior to the marriage, the parties also agreed that all property acquired by either
of the parties:
both prior to and subsequent to the contemplated marriage and
all benefits, income, interests, rents, profits and gains and
increases in value . . . which may in time accrue or result in any
manner, shall remain and be the separate property of that party
and subject entirely to his or her individual control and
ownership the same as if he or she were not married.
All household goods, furniture, fixtures, artwork, china, silver
and the like acquired during the marriage shall be deemed the
joint property of the parties if valued under One Thousand
Dollars ($1,000.00). Such property valued over One Thousand
Dollars ($1,000.00) shall be deemed to be the property of the
Husband unless Wife has paid for such with a check drawn on an
account in her sole name, a cashier’s check or money order with
her remitter or if Wife has other written evidence indicating the
item was a gift, an inheritance or belonging to her. Each party
herby waives, discharges and releases all right, title and interest
in and to the property and Proceeds of the other party presently
owned or hereafter acquired.
Ex. Vol., Petitioner’s Ex. 2.
2
Tina also argues that the trial court abused its discretion when it ordered that from the proceeds of the sale
of the parties’ real estate, Scott will be credited with the mortgage payments he makes while the properties are
for sale before any remaining equity is split equally between the parties. See Appellant’s Br. at 14; Appellant’s
App. p. 11. The prenuptial agreement simply provides that Tina is entitled to one half of “all jointly held
property, subject to one half (1/2) of all indebtedness thereon[.]” See Ex. Vol., Petitioner’s Ex. 2. Given his
minimal Walmart income, Scott must presumably pay those mortgage payments from the proceeds of
structured settlement, which under the prenuptial agreement, is solely his asset. Therefore, Tina has not
persuaded us that the trial court abused its discretion by giving Scott credit for the mortgage payments made
before the properties are sold.
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[23]   During the marriage, the parties used Scott’s annuity payments to purchase
vehicles and furniture. Accordingly, under the terms of the parties’ agreement,
any property valued over $1,000 is Scott’s property. The furniture and vehicles
at issue were all valued over $1,000.3 See Ex. Vol., Petitioner’s Ex. 6.
[24]   On the date of the dissolution hearing, the vehicles and furniture were in Tina’s
possession. The parties’ emancipated son was the primary driver of one of those
vehicles. The furniture was in the marital residence, and its value had decreased
to $5,000 because Tina allowed her animals to damage it. In her proposed
division of the marital assets, Tina requested the furniture and two of the three
vehicles. Ex. Vol., Respondent’s Ex. Q.
[25]   Because the trial court awarded Tina non-marital property, equity demanded
that the court offset the value of that property against the amount owed to Tina
under the prenuptial agreement. Accordingly, the trial court did not abuse its
discretion when it awarded Tina the non-marital property she requested but
also deducted the value of that property from the $70,000 settlement she was
owed pursuant to the parties’ agreement.
3
Tina argues that the vehicles were titled in both her and Scott’s names, and therefore, the vehicles, like the
marital residence, are marital assets and not subject to the terms of the prenuptial agreement. However, the
only evidence that the vehicles were titled jointly is the fact that they were listed as marital assets on Scott’s
financial declaration. See Ex. Vol., Respondent’s Ex. B. The titles of the vehicles were not admitted into
evidence. Therefore, we cannot conclude that the trial court abused its discretion when it determined that the
vehicles were not marital assets.
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Tina’s Attorney Fees for the CHINS Proceedings
[26]   The trial court also found that Tina dissipated marital assets by taking $15,000
from Scott’s 2013 Structured Settlement Payment to pay attorney fees incurred
by Tina to defend the CHINS action that arose from Tina’s neglect of her
residence, which endangered the health of the children in her care. Tina appeals
the trial court’s decision to deduct that $15,000 from the sum owed to her under
the prenuptial agreement.
[27]   To support her argument, Tina relies on the following provision in the
prenuptial agreement: “each party agrees that he or she shall not demand,
claim, take or receive from the other, any attorney’s fees or other litigation
expenses . . . to which he or she might otherwise be entitled by reason of any
rights arising out of or relating to the marriage and/or the relationship of the
parties.” Appellant’s Br. at 14-15 (quoting Ex. Vol., Petitioner’s Ex. 2).
[28]   This provision is inapplicable to the issue before us. Neither party is demanding
attorney fees from the other. Tina unilaterally took money from Scott’s
structured settlement payment to pay a debt that she incurred. Tina admitted
that, during the dissolution proceedings, she neglected her residence, and as a
result, CPS filed a CHINS action. Tr. p. 93. The trial court’s decision to deduct
the $15,000 from the $70,000 payment to which Tina is entitled under the terms
of the prenuptial agreement is simply the trial court’s attempt to make Scott
whole from Tina’s dissipation of marital assets.
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Credit Card Debt
[29]   Finally, Tina argues that the trial erred when it ordered her to pay
approximately $5,000 owed total on the J.C. Penney and the Chase Slate credit
card accounts. The division of marital property, which includes the parties’
assets and liabilities, is a two-step process. First, the trial court must determine
the property to be included in the marital estate. Leever v. Leever, 919 N.E.2d 118124 (Ind. Ct. App. 2009). Indiana Code section 31-15-7-4(a) provides that “the
court shall divide the property of the parties, whether: (1) owned by either
spouse before the marriage; (2) acquired by either spouse in his or her own
right: (A) after the marriage; and (B) before final separation of the parties; or (3)
acquired by their joint efforts.” “After determining what constitutes marital
property, the trial court must then divide the marital property under the
presumption that an equal split is just and reasonable.” Leever, 919 N.E.2d at
124 (citing Ind. Code § 31-15-7-5). Finally, the division of marital assets and
liabilities lies within the sound discretion of the trial court, and we will reverse
only for an abuse of that discretion. Keown v. Keown, 883 N.E.2d 865, 868 (Ind.
Ct. App. 2008).
[30]   The trial court found that “the parties have substantial credit card debt which
was primarily incurred by the Respondent who was in charge of the parties’
finances.” Appellant’s App. p. 13. Scott’s testimony supports this finding, and
Tina’s argument that she incurred most of the charges buying items for the
children is simply a request to reweigh the evidence and the credibility of the
witnesses, which our court will not do. See Keown, 883 N.E.2d at 868.
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[31]   Moreover, the trial court ordered Scott to bear responsibility for the parties’
joint Fifth Third debt in the amount of $5433.54. Ex. Vol., Petitioner’s Ex. 10,
Appellant’s App. p. 13. Also, it is reasonably likely that the marital residence
will be sold at a loss for which Scott will be financially responsible.
[32]   For all of these reasons, the trial court did not abuse its discretion when it
ordered Tina to bear responsibility for the debt incurred on the Chase and J.C.
Penney credit cards.
Conclusion
[33]   The trial court did not err when it interpreted the parties’ prenuptial agreement.
The trial court also did not err when it subtracted certain sums from Tina’s
$70,000 payment under the terms of the agreement after the court awarded her
non-marital assets at her request and due to her dissipation of Scott’s structured
settlement payments. However, the trial court erred when it failed to consider
Scott’s structured settlement payments in its calculation of Scott’s gross income
for the purposes of child support. We therefore remand this case to the trial
court for proceedings consistent with this opinion.
[34]   Affirmed in part, reversed in part, and remanded for proceedings consistent
with this opinion.
May, J., concurs.
Robb, J., concurs in result in part with opinion.
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IN THE
COURT OF APPEALS OF INDIANA
Tina Carmer, Court of Appeals Case No.
49A05-1411-DR-539
Appellant-Respondent,
v.
Scott Carmer,
Appellee-Petitioner
Robb, Judge, concurring in result in part.
[1]   I write separately to address only the first issue: whether the trial court abused
its discretion when it failed to include Scott’s monthly structured settlement
payments as income in the calculation of child support. The majority holds the
trial court abused its discretion when it failed to include Scott’s monthly
structured settlement payments in calculating his weekly gross income, citing
the definition of “weekly gross income” in Indiana Child Support Guideline
3(A) and the decision in Knisely v. Forte, 875 N.E.2d 335 (Ind. Ct. App. 2007),
that a personal injury settlement may be included in the weekly gross income
figure. See slip op. at ¶ 15.
[2]   I agree with the majority that Guideline 3(A) defines weekly gross income as
“income from any source,” and that it is a broader definition than the Internal
Revenue Code definition of gross income, on which the trial court relied in
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excluding Scott’s structured settlement payments from his weekly gross income.
However, I do not believe Knisely is particularly helpful in determining whether
Scott’s structured settlement payments are includable in his weekly gross
income. Knisely was concerned with how to treat a one-time payment in
settlement for an injury which left the father permanently disabled and unable
to work. Here, despite the serious injuries Scott sustained several years before
the marriage, he holds a steady job earning a weekly income of approximately
$450 per week in addition to his monthly structured settlement payments.
Although Knisely held the trial court did not abuse its discretion in considering
the one-time payment when calculating the father’s child support obligation, it
appears the father may have had no other means of supporting his children.
Further, the opinion does not parse how the trial court calculated the father’s
weekly income based upon the settlement amount. So although Knisely stands
for the general proposition that it is not an abuse of discretion to consider some
part of a lump-sum settlement in determining a party’s child support obligation,
it does not specifically help us determine whether the trial court in this case
erred in how it handled Scott’s structured settlement payments.
[3]   We are concerned with determining Scott’s weekly gross income. “Income” is
defined as “[t]hat which comes in as the periodical produce of one’s work,
business, lands, or investments . . . .” Oxford English Dictionary, OED Online,
http://www.oed.com/view/Entry/93645?rskey=tQFSVL&result=1#eid.
Personal injury settlements may include an income-replacement component,
but there is no indication that the entire settlement in this case was for that
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purpose. In fact, Scott is able to and does work a regular job, at least currently.
But personal injury settlements are also intended to reimburse past and future
medical expenses, disability, pain and suffering, caretaking, and other
extraordinary expenses arising from an injury. Scott testified that he suffered a
severe head injury which impacts his memory and leaves him at greater risk for
developing Alzheimer’s, Parkinson’s, or dementia in the future, tr. at 45, and
injuries to his leg and arm which restrict his physical activities, id. at 6-7. In
addition, he is currently undergoing occupational therapy several times a week
for which he pays directly. Id. at 62-63. To date, none of his structured
settlement proceeds have been set aside for his future medical care or
retirement. Id. at 40. Other courts which have addressed similar situations have
taken the position that only those portions of a personal injury settlement that
are meant to compensate for lost wages or future wage loss are “income” for
child support purposes even under an expansive definition of “income.” See,
e.g., Villanueva v. O’Gara, 668 N.E.2d 589, 592-96 (Ill. Ct. App. 1996)
(interpreting Illinois’s statutory definition of net income for child support
purposes, Ill. Comp. Stat. 5/504 (net income is “the total of all income from all
sources”), and holding it was error for the trial court to include the entire
personal injury settlement amount in the child support calculation; also citing
cases from several other jurisdictions deciding this issue).
[4]   Scott earns a weekly wage from employment, and I therefore do not necessarily
think the trial court would have abused its discretion in excluding the structured
settlement payments from a calculation of Scott’s weekly gross income had it
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not based that exclusion solely on the Internal Revenue Code definition of gross
income. As the majority notes, the Internal Revenue Code is not the standard
for determining weekly gross income for child support purposes, see slip op. at ¶
13 (quoting Child Supp. G. 3(A), cmt. 2(b) that the weekly gross income figure
may not be the same as gross income for tax purposes). It may be unfair to
exclude all of the settlement proceeds where they have inured to the family’s
benefit in the past but it may also be unfair to include all of the proceeds where
Scott has need of them for his own care. Commentary to Guideline 3(A) urges
judges to “be innovative in finding ways to include income that would have
benefited the family had it remained intact, but be receptive to deviations where
reasons justify them.” Child Supp. G. 3(A), cmt. 2(b); see also Harris, 800
N.E.2d at 940-41 (holding the trial court did not abuse its discretion in
including only the net amount of settlement proceeds from a wrongful
termination lawsuit because that is the amount that “would have ultimately
benefited the children if the family had remained intact.”).
[5]   Because the trial court’s decision was based on an improper legal standard, and
subject to the caveat that the trial court should have the leeway on remand to
make an “innovative” determination regarding the inclusion or exclusion in
whole or in part of Scott’s structured settlement payments, I concur in result as
to the child support issue. As to the remainder of the opinion, I concur in full.
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