Marriage of O Neil

No. 93-589
IN THE SUPREME COURT OF THE STATE OF MONTANA
1994
IN RE THE MARRIAGE OF
TAMMY MARIE (O'NEIL) ANDERSON,
Petitioner and Appellant,
and
RALPH EDWARD O'NEIL,
Respondent
APPEAL FROM: District Court of the First Judicial District,
In and for the County of Lewis and Clark,
The Honorable Dorothy McCarter, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
David N. Hull, Attorney at Law,
Helena, Montana
For Respondent:
Robert T. Cummins, Attorney at Law,
Helena, Montana
Submitted on Briefs: April 7, 1994
Decided: June 2, 1994
Filed:
Justice John Conway Harrison delivered the Opinion of the Court.
Tammy Marie (O'Neil) Anderson appeals from the August 24, 1993
order of the First Judicial District Court, Lewis and Clark County,
for failing to address Tammy's motion for attorney's fees. Ralph
Edward O'Neil cross-appeals the court's order regarding his child
support obligations. We affirm the District Court's judgment
regarding Ralph's child support obligations, and remand to the
District Court to award and determine appropriate attorney's fees
in accordance with the parties' separation agreement.
Tammy and Ralph divorced on January 14, 1988. The parties'
separation agreement, which was incorporated into the final
dissolution decree, provided for joint custody of the two children
with Tammy as primary physical custodian, and required Ralph to pay
child support and one-half of any of the children's uncovered
medical expenses. The separation agreement contained a clause
which provided that, "should any action be commenced to enforce,
modify or interpret any provision contained herein, the court, as
a cost of suit, shall award a reasonable attorney's fee to the
successful party."
Tammy filed a motion to modify Ralph's child support
obligation on June 21, 1993, in which she requested a recalculation
of support pursuant to the Montana Child Support Guidelines (MCSG) .
Tammy's motion further requested that she be awarded attorney's
fees as a result of the modification. After a hearing, and
recalculation under MCSG, the District Court ordered on August 24,
1993, that Ralph pay an increased amount of child support and all
2
of the children's uncovered medical expenses. The District Court
failed to address Tammy's request for attorney's fees.
Tammy and Ralph both filed motions to amend the District
Court's August 24, 1993 order. Tammy, as the successful party,
requested her attorney's fees from the modification hearing, and
Ralph requested modification of his child support and medical
obligations. On October 6, 1993, the District Court denied Ralph's
motion, but did not rule on Tammy's motion for attorney's fees.
I
Did the District Court err in failing to address the award of
Tammy's attorney's fees?
Pursuant to 5 40-4-201, MCA, parties, upon separation or
dissolution of marriage, may enter into written separation
agreements. If not unconscionable, the terms shall be set forth in
the dissolution decree, and the terms shall be binding upon the
district court. Section 40-4-201(1), (4)(a), MCA.
Tammy and Ralph entered into a separation agreement which
clearly and reasonably provided that the successful party in any
modification proceeding be awarded attorney's fees. In In re
Marriage of Boyer (Mont. 1993), 862 P.2d 384, 387, 50 St.Rep. 1277,
1279, a clause in Tom and Gail Boyerls separation agreement
contained an identical attorney's fee provision. The district
court in Marriaqe of Bover awarded attorney's fees based on that
provision, and we upheld the district court's decision and stated
that the attorney's fee provision was clear and binding. Marriaqe
of Bover, 862 P.2d at 388. In this case, the District Court failed
to even address Tammy's motion for attorney's fees. We, therefore,
remand this issue to the District Court to award and determine
appropriate attorney's fees in accordance with the parties1
separation agreement.
I1
Did the District Court err in modifying the partiesf initial
child support obligations pursuant to 5 40-4-208, MCA?
section 40-4-208 (2) (b) (i), MCA, requires a party requesting a
modification of a child support obligation to prove I9changed
circumstances so substantial and continuing as to make the terms
un~onscionable.``Ralph claims that Tammy failed to show a
sufficient change in circumstances to justify modifying his child
support obligations. We disagree.
Tammy is currently a full-time college student. In addition,
she runs a part-time secretarial service. Her gross annual income
is approximately $4,800. Ralph is employed by Northwestern Tire,
and his gross annual income is approximately $36,300. Tammy
alleged in her affidavit that the cost of raising the children has
increased as they have grown older, resulting in a change in
circumstances sufficient to warrant modification under g 40-4-
208 (2) (b)(i), MCA. - Tammy supplied the District Court with a
financial affidavit indicating her expenses, and the District Court
recalculated Ralphfs child support obligation pursuant to MCSG.
This case can be analogized to Marriage of Reynolds (1983),
203 Mont. 97, 660 P.2d 90. There, the wife petitioned the district
court for an increase in child support, contending, as part of her
testimony, that her two minor children's expenses--food, clothing
and high school-related activities--had increased as they had grown
older. Marriaqe of Reynolds, 660 P.2d at 93. When recalculating
the husband's child support obligations in Marriase of Revnolds,
the district court considered the increased age of the children and
found it to be a valid factor. Marriaqe of Reynolds, 660 P.2d at
94. On appeal this Court held that the district court was not
clearly erroneous in finding a sufficient change in circumstances
to warrant an increase in the husband's child support obligation.
Marriaqe of Revnolds, 660 P.2d at 94.
When reviewing the findings of a trial court, we will not
substitute our judgment for that of the trier of fact, but will
determine whether there is substantial credible evidence to support
those findings. In re Marriage of Johnson (1987), 225 Mont. 404,
407, 732 P.2d 1345, 1347. In the recent case of Matter of D.H. and
F.H. (Mont. 1994), 51 St.Rep. 386, 387, we held that even if we
determine that substantial credible evidence exists to support a
finding, we must still examine whether the finding is clearly
erroneous. In order to determine whether a finding is clearly
erroneous, we apply the following three-part test:
First, the Court will review the record to see if the
findings are supported by substantial evidence. Second,
if the findings are supported by substantial evidence we
will determine if the trial court has misapprehended the
effect of evidence. Third, if substantial evidence
exists and the effect of the evidence has not been
misapprehended the Court may still find that " [ a ] finding
is 'clearly erroneous' when, although there is evidence
to support it, a review of the record leaves the court
with the definite and firm conviction that a mistake has
been committed."
Matter of D.H., 51 St-Rep. at 387 (citations omitted) . We hold
that there is substantial evidence in the record to support the
District Court's findings in regard to Ralph's child support
modification. The District Court correctly determined that Tammy
showed sufficient evidence of changed circumstances to warrant the
modification, pursuant to 5 40-4-208(2)(b)(i), MCA, of Ralph's
initial child support obligation. The ~istrict Court did not
misapprehend the effect of the evidence or commit a mistake.
I11
Did the District Court err in portions of its findings of
fact, conclusions of law, and order?
The District Court, in its August 24, 1993 order, increased
Ralph's monthly child support obligation and the percentage of the
children's uncovered medical expenses Ralph was required to pay.
Ralph contends that the District Court erred in regard to several
findings of fact and conclusions of law.
Although we adopted the three-part test, as restated in
Matter of D.H., 51 St.Rep. at 387, to determine whether a finding
of fact is clearly erroneous, in reviewing conclusions of law, we
examine whether the trial court correctly interpreted the law.
Steer, Inc. v. Deplt of Revenue (1990), 245 Mont. 470, 474, 803
P.2d 601, 603.
Ralph contends that his annual bonus of $1,500 should not have
been included in his gross income computation since there is no
guarantee that he will continue to receive this bonus in the
future. However, § 46.30.1508 (1)(a), ARM, states that bonuses are
to be included in gross income computations for the purpose of
determining child support obligations. We hold that the District
Court's decision to include Ralph's annual bonus in his gross
income computation was not clearly erroneous.
Ralph contends that Tammy's income was incorrectly determined
because the District Court failed to impute income to her. Ralph
contends that since Tammy has the earning capacity of five dollars
per hour, the District Court was required to compute her income
based on that rate. We disagree.
We have previously held that, in addition to earning capacity,
district courts are obliged to consider other factors, such as
available employment opportunities, when imputing income to a
party. In re Marriage of Gebhardt (1989), 240 Mont. 165, 172, 783
P.2d 400, 404. Moreover, 5 46.30.1513(2) (d)(iii), ARM, clearly
states that income should not be imputed to a parent who is
"engaged in a plan of economic self-improvement, including but not
limited to education" which would, within a reasonable amount of
time, be economically beneficial to the children. Tammy is a full-
time college student pursuing higher education. Tammy's
educational pursuit is intended to result in increased income and
financial security for her children. She is well into her "planf8
and, therefore, in a reasonable amount of time is very likely to
complete her education and reap the financial benefits.
Accordingly, we hold that the ~istrict Court was not clearly
erroneous in relying on Tammy's actual rather than imputed income
to establish Ralph's child support obligation.
Ralph also contends that the ~istrict Court neglected to
consider T r m ' earned income credit from 1992.
anys However, Ralph
was given a $50 per month credit as a variance from the guidelines
because Tammy claimed both children as exemptions for tax purposes.
We hold that the District Court was not clearly erroneous in its
computation of the incomes of Tammy and Ralph.
Ralph contends that he should be credited for keeping the
children two months out of the year. This argument is contrary to
§ 46.30.1535(2), ARM, which s t a t e s that c h i l d support obligations
are monthly. There is an exception if the parties have an extended
visitation/shared physical custody arrangement in which the party
paying child support keeps the children more than 110 days each
year. Section 46.30.1535(5), ARM. Ralph does not keep the
children for more than two consecutive months per year. Therefore,
we hold that the District Court war; not clearly erroneous in
requiring Ralph to pay his child support obligations on a monthly
basis.
Finally, Ralph contends that the District Court should not
have modified the partiest original agreement regarding the
children's uncovered medical expenses since it was not requested to
do so. However, after the District Court determined that the
parental share of combined resources was 100% attributable to
Ralph, the court, accordingly, allocated 100% of the uncovered
medical expenses to Ralph. We hold that the District Court was
correct in its allocation of the children's uncovered medical
expenses.
We conclude that the District Court's modifications of Ralph's
child support obligations and medical expenses were not clearly
erroneous. We remand to the District Court to award and determine
appropriate attorney's fees in accordance with the parties'
separation agreement.
Pursuant to Section I, Paragraph 3(c), Montana Supreme Court
1988 Internal Operating Rules, this decision shall not be cited as
precedent and shall be published by its filing as a public document
with the Clerk of the Supreme Court and by a report of its result
to Montana Law Week, State Reporter and West Publishing Company.
Justice Karla M. Gray, dissenting.
I must respectfully dissent from the Court's opinion.
The Court correctly states the statutory standard to be
applied by the District Court in modifying the partiest original
child support obligations: the party requesting such a modification
must prove "changed circumstances so substantial and continuing as
to make the terms uncon~cionable.``
section 40-4-208 (2) (b) (i), MCA.
Unfortunately, the Court then proceeds to ignore the standard and
the fact that nothing in the District Court's findings, conclusions
and order indicates that it applied the standard. I cannot agree.
The unconscionability standard necessarily requires something
more than any change in circumstances no matter how small; it is,
and was intended to be, a difficult standard for the party
requesting modification to meet. Here, no findings or conclusions
by the District Court indicate that the standard was met; nor does
this Court's opinion fill that gap from record testimony or other
evidence.
In this regard, the case before us is unlike the Marriase of
Reynolds case upon which it purports to rely. There, the district
court set forth the actual changes in the parties1 circumstances
which provided the basis for its modification; we reviewed the
courtts findings and concluded that they were well supported by
substantial evidence in the record and, therefore, not clearly
erroneous. Marriage of Reynolds, 660 P.2d at 92-93, On that
basis, we held that the changed circumstances of the parties were
91so
substantial and continuing as to make the terms of the original
decree unconscionable." Marriaae of Reynolds, 660 P.2d at 93-94.
I would remand this case to the District Court for the entry
of findings and conclusions regarding whether--and, if so, how--
Tammy met the 5 40-4-208(2)(b)(i), MCA, standard. To do otherwise
amounts to judicial amendment of the statutory standard. For that
reason, I would not conclude at this time that Tammy is entitled to
attorney I fees as the prevailing party. That issue also should be
s
addressed by the District Court on remand.
June 2, 1994
CERTIFICATE OF SERVICE
I hereby certify that the following certified order was sent by United States mail, prepaid, to the
following named:
DAVID N. HULL
Attorney at Law
P.O. Box 534
Helena, MT 59624
ROBERT T. CUMMINS
Attorney at Law
One North Last Chance Gulch
Helena, MT 59601
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA