Opinion
15-P-1145
03-10-2017
Frank MCCLELLAND v. Catherine MCCLELLAND.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
After a trial in the Probate and Family Court on the parties' cross complaints for modification of their 2004 divorce judgment, an amended modification judgment entered on July 14, 2005, ending the mother's general-term alimony, increasing the father's weekly child support obligation, and shifting to the father full responsibility for the education expenses of the couple's two younger children. The parties cross-appealed, with the father arguing the judge abused her discretion with respect to child support and education costs and the mother challenging the denial of attorney's fees and requesting retroactive application of the shift in education costs. We reverse in part, affirm in part, and remand for additional proceedings.
The amended judgment was entered nunc pro tunc to February 6, 2015.
The couple's eldest child is emancipated.
Background . The parties were married in 1986 and separated in 1999. Both during the marriage and afterward, the father was an accomplished chef and restauranteur in the Boston area. Under a separation agreement, which merged with the divorce judgment, the mother received primary physical custody of the three children and the marital home, where she still lives. The agreement also provided that the father would pay child support and alimony equivalent to thirty-eight percent of his gross weekly income (nineteen percent each), and that he would be responsible for seventy-five percent of the children's secondary school expenses, while the mother would pay the remaining twenty-five percent.
As a result of the economic downturn, the father reported substantial reductions in his income between 2008 and 2014. During this period the father sought two modification judgments, which together reduced his support payments by approximately one-half (the 2009 modification and the 2010 modification). However, the father's child support and alimony obligations each continued to represent nineteen percent of his gross income, and the agreement with respect to the allocation of the children's secondary school expenses did not change. Under the 2010 modification, the parties agreed for the first time that they would each pay one-third of the children's college education expenses and that the children would pay the remaining third. It is now undisputed that the father's stepmother ("Grandma Jean") has paid all of the father's share of the children's education expenses since the divorce judgment entered in 2004.
Since 2008, the father also has invested considerable personal assets in a number of side projects. The father testified that he was not receiving income from these projects. The father in fact claimed to be losing money on one of these ventures, testimony which the judge did not credit.
The parties, in fact, each paid one-half of the middle child's college costs to relieve the child of her obligation to pay her own one-third share. This informal arrangement, which was never part of a written agreement, does not constitute a child support modification. See Purdy v. Colangelo , 61 Mass. App. Ct. 362, 364 (2004) (noting statutory prohibition of extrajudicial modification of support orders).
In 2013, the parties filed cross complaints for modification, with the father requesting another child support reduction and termination of alimony. Neither party raised any issue relating to the division or payment of education expenses. By the time of trial, the middle child was twenty-one years old and lived on her college campus during the school year and with her mother on breaks. The youngest child was seventeen years old and away at boarding school during the academic year.
In the findings accompanying the modification judgment now before us, the judge found that both parties were living well beyond their means. She also found that the father had intentionally concealed Grandma Jean's contributions to the children's education expenses and that the earlier modification judgments were therefore based on "false representations." However, the 2009 modification explicitly stated that "a significant amount of [the father's] ability to pay is the result of his ready ability either to borrow funds from or obtain monetary gifts from members of his family," indicating that both the judge and the mother were aware by that time that the father was receiving financial assistance.
The father, despite his declining income and substantial losses on his various business ventures, continued to purchase luxuries and take expensive vacations with his second wife and their children. The mother was also spending excessively, had not sold the marital home despite her inability to keep up with its carrying costs, and had not sought full-time employment (she began to work part-time in 2013).
Nevertheless, the judge took into account the perceived misrepresentation and prospectively shifted responsibility for 100 percent of the children's education costs to the father. The judgment also increased the father's child support obligation from nineteen percent of his weekly income to twenty-five percent upon the termination of alimony in December of 2014.
The mother does not challenge the termination of alimony.
Education expenses . The father argues that the judge abused her discretion in raising sua sponte the issue of education expenses. Seeing no reason for the judge to disturb an agreement with which both parties apparently were content, we agree.
In Purdy v. Colangelo , 61 Mass. App. Ct. 362, 365 (2004), this court held that where the parties' earlier agreements were silent on the issue of allocation of education costs and neither party had sought modification, "exceptional circumstances would be required" for the judge to issue a discretionary order for such expenses after the child had graduated. We have before us arguably an even more forceful case for judicial restraint. The parties here had in fact resolved the matter of education costs, and the judge's sua sponte order thus effectively created a dispute where none otherwise existed. See Bercume v. Bercume , 428 Mass. 635, 644 (1999) ("To the extent possible, and consistent with common sense and justice, the modified judgment should take into account the earlier, expressed desires of the parties").
Even were we to conclude that the judge properly considered the education expenses, we are not convinced that her order could stand on the merits. Contrary to the mother's argument, the judge explicitly ordered the father to make (not merely be responsible for) all payments for the children's education, and thus placed the burden on the father himself, not, by implication, on Grandma Jean. However, the judge's findings do not warrant such a drastic increase in the father's financial obligations. To the extent that she imputed to the father as income Grandma Jean's financial contributions, it was improper to do so without considering certain criteria. See Fehrm-Cappuccino v. Cappuccino , 90 Mass. App. Ct. 525, 529 (2016) (quotation omitted) (directing courts attributing to a parent's income contributions from a third party to consider the "lack of an obligation of [the party] to support the children," and other factors). Additionally, there is nothing in the record to suggest that Grandma Jean is willing to pay 100 percent of the children's education expenses, rather than just the father's share.
The mother is left to argue that by seeking a reduction in child support, the father opened the door for the judge to consider education expenses. See, e.g., Passemato v. Passemato , 427 Mass. 52, 57 (1998) (creation of trust for children's future education expenses "in the nature of child support"). It is true that education costs may be considered in connection with child support. Kirkwood v. Kirkwood , 27 Mass. App. Ct. 1156, 1157 (1989). However, it does not follow that these costs must or even should be dealt with jointly, especially where, as here, neither party requested this and the parties historically had allocated education expenses through a separate arrangement, which was not affected by changes in the support order. The mere fact that a modification of child support was again on the table was not sufficient reason for the judge to overhaul an existing agreement that apparently satisfied both parties.
We therefore reverse the amended judgment with respect to education costs. We reinstate the parties' previous agreement dividing secondary school costs on a seventy-five percent/twenty-five percent basis between the father and mother and assigning to the mother responsibility for one-third of the college expenses of each of the children. This order is effective from the date the judge's reallocation of education expenses took effect, the first semester of 2015.
Child support . With respect to the modification of child support, the judge did not adequately explain what material and substantial change in circumstances warranted increasing the father's obligation, particularly in light of the fact that her findings appear to point to the need for a downward modification.
Where, as here, a case falls outside of the Child Support Guidelines, the modification of an existing support order is appropriate if there has been "a material change of circumstances since the entry of the earlier judgment." Schuler v. Schuler , 382 Mass. 366, 368 (1981). A Probate and Family Court judge enjoys broad discretion in fashioning a modification judgment under these circumstances. Id . at 370. However, "[w]hen the judgment to be modified incorporates an agreement of the parties," we "review the findings to determine whether the judge gave appropriate consideration to the parties' intentions as expressed in their written agreement, ... and to any changes in their circumstances since the last modification judgment." See Cooper v. Cooper , 62 Mass. App. Ct. 130, 134 (2004), quoting from Huddleston v. Huddleston , 51 Mass. App. Ct. 563, 568 (2001).
This case is not governed by the guidelines because the parties' available income exceeds $250,000. 2013 Child Support Guidelines § II.C. Therefore, any inconsistency between the existing support order and the guidelines need not be taken into consideration in fashioning a modification. See Morales v. Morales , 464 Mass. 507, 511-512 (2013) (articulating the "inconsistency standard" governing modification of child support orders in cases where the parties' combined available income falls within the guidelines).
The judge found that, due to the eldest child's emancipation and the fact that the younger two children no longer reside with the mother for the better part of the year, "appropriate reduction in support [was] warranted." She also appeared to credit the father's evidence that his weekly income had decreased. See Buchanan v. Buchanan , 353 Mass. 351, 353 (1967) (changes in children's needs or financial status of support provider may warrant modification). See also Winternitz v. Winternitz , 19 Mass. App. Ct. 228, 232 (1985) (child's emancipation amounts to material change). Although the judge terminated the mother's alimony, she also found that the mother had a new source of income from part-time employment and that she was able to increase and/or supplement her earnings if she chose to do so. Despite these indications that the father's payments should decrease , the judge increased the child support obligation to twenty-five percent of the father's gross weekly income without further explanation.
The mother also receives an annual gift from her mother. However, as noted, where the judge did not make the necessary findings, it is improper for the father's family's contributions to be attributed to his income. We similarly do not attribute to the mother's income her own family's financial support where the judge has not made the necessary findings.
In doing so, she appears to have relied upon two additional considerations. First, the judge viewed the reduction in the father's income as only "temporary," a conclusion that was not adequately explained. Second, the judge found that "a substantial change in circumstances is the fact that [the father] has not made any substantial contribution to the children's educational expenses since the time of the Divorce Judgment." She appeared to conclude that the father had somehow obtained a windfall in the form of reduced child support under the prior modifications by including in his statement of expenses the children's education costs without clarifying that Grandma Jean was paying those costs. Even if such a windfall did exist, it is not apparent from the judge's decision why the father's overstating his expenses constituted a material change in circumstances. The judge found that Grandma Jean has been providing for the father's share of the children's education since the divorce judgment entered in 2004, and it is clear that the judge was aware of those contributions by the time of the 2009 modification at the latest. Even if we assume arguendo that this did constitute a material change in circumstances, the basis for the judge's conclusion that the father had accrued some financial benefit by his misstatement is also unclear. The prior support orders were based on a negotiated agreement between the parties that set child support as a percentage of the father's "gross income" (and thus would not have been altered by his having reported expenses that he was not, in fact, paying). There also is no indication in the judge's findings that she found the original agreement to have been the result of any fraud or unfairness in the negotiations.
The judge's supported findings indicate that the father's earnings have either stayed the same or declined since 2013, but there is nothing in the record indicating that the father's income had increased since the last judgment of modification in 2010. To be sure, the father may have high hopes for his side ventures. However, it is not clear what evidence in the record supports the conclusion that these ventures soon will generate additional income for him. In addition, the judge has not addressed whether or not these ventures qualify as "second-jobs," or whether she may properly consider income from those ventures for purposes of modifying the husband's child support obligation. See Vedensky v. Vedensky , 86 Mass. App. Ct. 768, 777-778 (2014). See also 2013 Child Support Guidelines (discussing income from second job).
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Given this, the parties' long-standing arrangement that child support would represent nineteen percent of the father's gross income must be taken into account, and any material change in circumstances warranting an upward modification of that agreement must be identified explicitly. It is well within the judge's purview to increase child support, but in circumstances such as these it is necessary to fully explain the reasons for doing so. See M.C . v. T.K ., 463 Mass. 226, 233 (2012) (quotation omitted) ("Where the parties' combined gross income exceeds the maximum level at which the guidelines are strictly applicable, a judge has discretion to adjust upward from the minimum presumptive level of support"). See also Freedman v. Freedman , 49 Mass. App. Ct. 519, 521 (2000) (judge's action must be supported by the findings of fact). We therefore remand the issue of child support for further findings.
Attorney's fees . On cross appeal, the mother asks us to overturn the judge's denial of attorney's fees, arguing that the father's "outright dishonesty" regarding the source of his share of the children's education expenses warrants sanction. We disagree. As noted, the record reveals that at least as of 2009, the Probate and Family Court judge was well aware that the father's family was helping to pay the education costs. The mother also has not claimed that she was surprised by this disclosure. Furthermore, as the judge pointed out, neither party was blameless in this action. She was well within her discretion in declining to award fees. See Wolcott v. Wolcott , 78 Mass. App. Ct. 539, 546 (2011) (trial court has "broad discretion" to award or deny fees).
Disposition . We reverse the judge's reallocation of education expenses and reinstate the distribution of college expenses set forth in the 2010 modification judgment and the allocation of secondary school expenses set forth in the original divorce judgment. We vacate the portion of the judgment increasing the father's child support obligation as of the date of the termination of alimony and remand for further findings on that issue. In all remaining respects, the amended judgment of modification is affirmed.
So ordered .
Reversed in part, vacated and remanded in part, and affirmed in part.