In RE MARRIAGE OF ENDERS v. Enders

MYSE, J.

Susan Enders appeals a judgment granting the parties a divorce. The trial court divided their property and debts, granted Robert Enders custody of their two minor children, and awarded Susan $700 maintenance for six months and $1,000 thereafter for an indefinite period of time.¹ The court also denied both parties’ requests for contribution toward their attorney fees.

Susan makes three arguments. First, she attacks the court’s maintenance determination by asserting that it erred by using Robert’s net income rather than gross income, by subtracting an inappropriate amount for child support before awarding maintenance, and by failing to consider the tax consequences that the maintenance award would have to the parties. Second, Susan alleges that the trial court abused its discretion by considering her past alcohol problems in making its maintenance determination. Third, she contends that the court abused its discretion by denying her request for contribution toward her attorney fees. We reject her arguments and affirm the judgment.

The parties were married in June, 1969, and they have two children. They were separated in May, 1987, at which time Susan was thirty-six years old and Robert was thirty-eight years old. At the time of the divorce, Susan, who had a high school education, was working about fifteen hours a week as a secretary. Robert, who attended college for two years, has been a salesman for a medical supply company for thirteen years.

The court divided their property on an equal basis, with Susan receiving about $45,700 and Robert receiving about $43,900 in cash and property. The trial court adjusted the maintenance award for six months to equalize the property division because Susan received $1,800 more than Robert in the property division. Robert received the homestead but also assumed the entire marital debt of $111,900. Pursuant to a stipulation by the parties, Robert was also granted custody of the two children.

We review a maintenance determination as a challenge to the trial court’s exercise of discretion and will affirm the trial court unless we find an abuse of discretion. Harris v. Harris, 141 Wis. 2d 569, 573, 415 N.W.2d 586, 588 (Ct. App. 1987). The trial court does not abuse its discretion if its determination reflects a reasoned approach based upon proper considerations of law and articulates reasons for its conclusion. Steinke v. Steinke, 126 Wis. 2d 372, 383, 376 N.W.2d 839, 845 (1985). The object of a maintenance determination is to leave each party with adequate means of support and to treat each party fairly and equitably. LaRocque v. LaRocque, 139 Wis. 2d 23, 32-33, 406 N.W.2d 736, 740 (1987).

To fully understand Susan’s challenge to the trial court’s determination it is necessary to describe how the trial court reached its decision that $1,000 per month for an indefinite period of time was an appropriate maintenance award. Robert’s earnings consisted of both a base salary and bonuses that were determined on the basis of the amount of his sales in the preceeding quarter. While he earned over $80,000 in 1985, and over $90,000 in 1986, the trial court found that he incurred substantial expenses for necessary travel, meals, and lodging to create this income. On his 1986 income tax returns he deducted over $20,000 in business expenses.

The court deducted some, but not all, of these expenses, as well as some amount for state and federal taxes, from Robert’s total earnings before determining maintenance. The court apparently reasoned that because these amounts were not available for his use in maintaining himself, Susan, and the children, or in discharging the substantial marital indebtedness he incurred in the divorce judgment, they should not be considered in the maintenance determination.

The trial court concluded that Robert had a net income of $5,000 per month that was available for the support of himself, his two children, and maintenance payments to Susan.² Because he was awarded custody of the two children, the trial court determined that a suitable sum representing expenses necessarily incurred in the support of the two minor children should be deducted from the $5,000 before calculating the appropriate amount of maintenance payments to Susan.

Given the nature of their lifestyle, Robert’s annual earnings, and the balance of the statutory factors the court concluded that the actual cost of maintaining the two children in a manner consistent with their lifestyle prior to the divorce was $1,500. The court then deducted that amount from Robert’s $5,000 per month net earnings.

This left $3,500 available for the support and maintenance of Robert and Susan. The trial court divided the $3,500 equally between Robert and Susan, leaving $1,750 for each, from which the court deducted Susan’s expected net monthly income of $675. After rounding the figures off, the court awarded Susan maintenance of $1,000 per month.

Susan challenges the trial court’s maintenance determination in three different respects. First, Susan contends that the trial court must as a matter of law apply the fifty-fifty presumption at the gross income level. This would have resulted in her receiving $4,000 per month maintenance for an indefinite period of time, minus child support payments calculated on the basis of her income. However, this would have left Robert with only $4,000 per month from which he would be required to pay taxes on his own salary, discharge marital debts of over $110,000, pay all expenses necessary to produce his income, and contribute to the support of the two children as well as support himself. Susan, on the other hand, would receive $4,000 per month maintenance payments plus such earnings as she produced to support herself less child support payments.

LaRocque requires a fairness factor in calculations such as those challenged here. There are several factors that indicate a maintenance award of $1,000 per month for an indefinite period of time is fair. While this case involves an eighteen-year marriage, Susan was only thirty-six years old at the time of the divorce. Robert earns a substantial income but has incurred substantial financial obligations as well. Susan is able to leave the marriage with no financial obligations, a substantial amount of property based on the property division, and at least a $1,000 per month income for potentially the rest of her life. In addition, the record establishes that her anticipated earnings are from $10,000 to $11,000 per year.

Essentially Susan argues that LaRocque requires that the trial court begin its analysis by dividing the parties’ gross income in half. However, LaRocque mandates an approach, not a result. It articulates factors that the trial court must consider in achieving an appropriate amount of maintenance to be paid by one spouse to another after a long-term marriage to ensure that the end result is fair and equitable to each party.

There is no rule of law in Wisconsin stating that a recipient spouse is entitled to one-half of the other’s salary for the rest of his or her life. LaRocque mandates that the trial court consider the parties’ gross income at the time it determines maintenance, not that the gross income be used to calculate maintenance in some mechanical way. LaRocque is not a limitation on the trial court’s exercise of discretion as long as the court properly considers the appropriate factors. Because of the significant expenses associated with the creation of Robert’s gross income, we conclude that the trial court did not abuse its discretion when it calculated maintenance based on his net rather than gross earnings.

The dissent contends that LaRocque mandates a lock step formula that trial courts must use in determining maintenance. Such a mandate is the antithesis of discretion. The actual method used by the trial court is within the court’s discretion because it was a reasoned analysis resulting in a fair conclusion. As long as the analysis is reasonable and the result is fair, we will uphold such an exercise of discretion.

Susan next challenges the trial court’s deduction of $1,500 from Robert’s income for the support of the minor children before it calculated maintenance. The fact that a father is awarded custody of minor children has a direct relationship to how much maintenance he can pay. Hirth v. Hirth, 48 Wis. 2d 491, 496, 180 N.W.2d 601, 604 (1970). Susan argues that the trial court’s approach in reality requires her to pay child support long after the children reach majority.³ However, the trial court did not issue a child support order against Susan, a fact it considered when setting the maintenance award. The approach used by the trial court is unusual and, while we conclude it is not an abuse of discretion, it is not an approach we recommend to trial judges.

Although there may be merit in Susan’s contention, it is based on the assumption that the trial court is not required to reexamine the maintenance issue once the children reach majority. Section 767.32 governs the modification of maintenance awards. When faced with the responsibility of issuing orders effective for a prolonged period of time, the trial court may anticipate changes in circumstances that are certain to occur, and enter an order reflecting such changes. However, a court also has the option of postponing a decision until the anticipated event actually occurs and then reexamining the issue based upon the circumstances occurring when the children reach majority. The critical point is whether the trial court took the factor alleged to have changed into account when it made its initial decision. See Erath v. Erath, 141 Wis. 2d 948, 954, 417 N.W.2d 407, 409-10 (Ct. App. 1987).

While the trial court’s approach was within its discretion, its failure to address the appropriate amount of maintenance once the children reach their majority means that the trial court must regard majority of the children as a change of circumstances, entitling Susan to a reexamination of the appropriateness of her maintenance award. See sec. 767.32, Stats. Whether she is entitled to a modification is a function of the trial court’s discretion based on the circumstances in existence at that time. Susan’s ability to bring a motion under sec. 767.32 once this change in circumstances actually occurs resolves her contention that she will be in fact contributing to the support of the children when she and Robert no longer have a legal responsibility to do so.

Contrary to what the dissent states, we are not forcing Susan to go into court in the future to correct a present error because of our conclusion that there is no present error. The error, if any, would occur only after the children reached majority if the trial court refused to consider this event a change in circumstances under sec. 767.32.

Susan also argues that the trial court abused its discretion by not considering the tax consequences of the maintenance award and by not crediting her with tax savings that Robert will enjoy because he can deduct part of the maintenance payments from his income. We disagree. The trial court was very much aware of the tax consequences of its determinations, which the record reflects. The court considered tax consequences in arriving at Robert’s "net” income and expressly stated that it realized that while fully deductible by Robert, the maintenance payments were fully taxable to Susan. We reject Susan’s argument because it is based on a hypothetical maintenance award rather than the award she actually received.

Given the length of time over which maintenance was ordered, Susan’s age and earning capacity, Robert’s level of indebtedness, and the requirement that the court reexamine the question of maintenance when circumstances regarding the children have changed, we conclude that the fairness objectives articulated in LaRocque have been met by the court’s award. Indeed, Robert could draw the fairness issue into question because he is being required to pay $1,000 per month for the rest of a thirty-six-year-old woman’s life even though she is no longer contributing to the production of his income, the creation of a marital estate or the financial, emotional, or physical well-being of the primary wage-earner. While Robert may well complain that it is unfair for him to support a former spouse for life, we view the trial court’s order as essentially within the broad parameters of fairness for both parties.

Next, Susan argues that the trial court abused its discretion by considering her past alcohol problems when making its maintenance determination. We disagree. While the trial court did allude to Robert’s allegations that Susan’s alcohol problems resulted in her contributing little for a period of time during the marriage, at the final hearing the court rejected this argument. The court fully explained how it reached its determination, and this factor was not reflected in the court’s analysis. There is simply no evidence that the trial court relied on Susan’s past alcohol problems when making its determination.

Finally, Susan claims that the trial court erred by failing to require Robert to make a contribution toward her attorney fees. Section 767.262 provides that the court may, after considering both parties’ financial resources, order either party to pay a reasonable amount for the other’s attorney fees. This issue is submitted to the sound discretion of the trial court. Kastelic v. Kastelic, 119 Wis. 2d 280, 290, 350 N.W.2d 714, 719 (Ct. App. 1984).

We will uphold a trial court’s discretionary decision if we can conclude ab initio that there are facts of record that would support the trial court’s decision had discretion been exercised on the basis of those facts. Conrad v. Conrad, 92 Wis. 2d 407, 415, 284 N.W.2d 674, 678 (1979). The record supports the trial court’s conclusion that each party pay his or her own attorney fees. Susan received $1,000 per month maintenance, as well as a substantial amount of property, including cash. In addition, she had an anticipated income of $10,000 to $11,000 per year. Robert, while having a higher income than Susan, also incurred more financial obligations than she as a result of the divorce. Under these circumstances, it is reasonable for the trial court to determine that each party should pay his or her attorney fees. Susan’s assets, earnings and maintenance payments are sufficient for her to discharge her own obligation toward counsel.

Finally, we deny Robert’s motion to have this appeal declared frivolous, under sec. 809.25(3), Stats. Given the changing law in this area, we cannot conclude that the appeal was frivolous.

By the Court. — Judgment affirmed.

1 The initial reduction in maintenance was used to equalize the property division.

2 The trial court apparently subtracted some, but not all, of Robert’s expenses and taxes in arriving at a figure of $5,000 as his monthly "net” income. Subtracting business expenses of $20,000 plus state and federal taxes would have resulted in a net income of less than $5,000.

3 Child support obligations may extend until the child reaches age nineteen or is no longer pursuing a high school diploma, whichever occurs first. Sec. 767.25(4), Stats. However, for the purpose of clarity we will hereafter refer to the termination of support as being the time the child reaches majority.