Opinion
No. C4-01-33.
Filed July 10, 2001.
Appeal from the District Court, Carlton County, File No. FX92000909.
Rebecca Marie Cary-Hill, (appellant pro se)
Michael Gene Cary, (respondent pro se)
Considered and decided by Willis, Presiding Judge, Halbrooks, Judge, and Hanson, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
In this child-support modification dispute, appellant alleges that the district court (1) misapplied the Hortis/Valento formula by failing to consider the fact that she had physical custody of the children; (2) did not make adequate findings to support its calculation of respondent's obligation; and (3) improperly considered respondent's second family when addressing the question of medical support for the parties' minor child. Because the district court did not abuse its discretion in its reduction of child support, we affirm on that issue. But because we agree with appellant that the district court erred in its determination of the appropriate level of medical insurance for the parties' minor child, we reverse and remand on the issue of respondent's medical insurance obligation.
FACTS
In December 1992, appellant Rebecca Marie Cary-Hill and respondent Michael Cary dissolved their 16-year marriage. In her marriage-dissolution petition, appellant stated that the best interests of their two minor children, N.C. and Z.C., would be served by awarding her sole physical custody, but she then asked the court to award joint legal and physical custody to the parties. Respondent's prehearing statement simply stated that the parties agreed to "joint custody" for both children. Pursuant to the dissolution order, the parties had joint legal custody. Appellant was awarded "primary" physical custody and maintained the children's primary residence. Respondent had liberal visitation rights and physical custody over the children "approximately one half of the children's time." The district court ordered respondent to pay $323.34 per month in child support until N.C. turned 18 or became emancipated. It is unclear how the court came to this figure, but the parties agreed to the amount knowing that it was "a departure from the Minnesota Child Support Guidelines, * * * based upon the assumption that [respondent would] have the children approximately one half of the time." Respondent was ordered to provide medical insurance for the minor children. Non-covered medical expenses were to be split equally.
At some point following the dissolution, respondent fathered a daughter, and appellant remarried.
On August 23, 2000, respondent filed a motion to reduce or modify his child-support obligation because N.C. was 18 years old and emancipated. Because of cost-of-living adjustments, respondent's obligation had risen to $383 per month. Several times throughout the hearing, the district court expressed its confusion as to how the parties had previously determined child support. If appellant had sole physical custody, the court noted that the guidelines child-support amount at the time of the dissolution would have been $488 per month, $165 per month more than the actual payment. The district court asked the parties why the dissolution court did not apply the Hortis/Valento formula to determine the child-support obligation. The parties responded that they had agreed to the amount and did not know what the Hortis/Valento formula was.
The district court granted respondent's motion to modify his child-support obligation. The court found that, under Minn. Stat. § 518.64, subd. 2(b)(1) (2000), respondent's obligation was "rebuttably presumed to be unreasonable and unfair" because "the parties' present circumstances result in a current support order that is at least $50 per month and 20 percent higher than" it ought to be under the child-support guidelines. As the parties were continuing to share physical custody of Z.C. equally, the district court divided respondent's guidelines-based obligation in half to $138 per month. Respondent was also ordered to continue to maintain medical insurance for Z.C., but not at a cost in excess of maintaining coverage for his second family. Appellant petitioned the district court for review and the court affirmed its decision. This appeal follows.
DECISION I
Appellant argues that the district court failed to show how the previous order was unreasonable and unfair. She contends that the court was required to make findings regarding their minor child's best interests before modifying the child-support obligation.
An obligor may petition to modify child support when either party's circumstances have changed substantially. Minn. Stat. § 518.64, subd. 2(a) (2000). Under Minnesota law,
[i]t is presumed that there has been a substantial change in circumstances * * * and the terms of a current support order shall be rebuttably presumed to be unreasonable and unfair if:
(1) the application of the child support guidelines * * * to the current circumstances of the parties results in a calculated court order that is at least 20 percent and at least $50 per month higher or lower than the current support order * * * .
Minn. Stat. § 518.551, subd. 5(i) (2000).
Here, the district court did not err in finding that respondent's child-support order was unfair and unreasonable. The parties have joint physical custody. See Lutzi v. Lutzi, 485 N.W.2d 311, 314 (Minn.App. 1992) (noting that some courts designate joint physical custodians as primary and secondary joint custodians). Given this physical custody arrangement, the court determined that respondent's child-support obligation should be $138 per month. Respondent paid $383 per month. Under the statute, that amount is presumptively unfair and unreasonable.
Moreover, the terms of the dissolution order required respondent's obligation to be recalculated "in accordance with the Child Support Guidelines now in existence" once each child reached the age of 18.
II
Appellant argues that even if the previous order was unreasonable and unfair, the district court erred by requiring the use of a Hortis/Valento formula, which requires a parent to pay guideline child support only for the periods of time that the other parent has custody of the children. See Valento v. Valento, 385 N.W.2d 860, 862 (Minn.App. 1986), review denied (Minn. June 30, 1986); Hortis v. Hortis, 367 N.W.2d 633, 636 (Minn.App. 1985). Appellant believes the formula is inapplicable here because in those cases, the parties had joint physical custody, whereas here, she has primary physical custody.
Our analysis of this issue is based on our position that there is no legal significance created by the use of the terms "joint" and "primary" physical custody. "Courts may choose, as some do, to designate joint physical custodians as primary and secondary joint custodians." Lutzi, 485 N.W.2d at 314. Moreover, the court based its interpretation "on the reality of the situation as opposed to what a piece of paper says," and the "reality of the situation" is that Z.C. is "living equally in the homes of both parents." Cf. Rosenfeld v. Rosenfeld, 529 N.W.2d 724, 726 (Minn.App. 1995) (stating that "the designation of a placement depends on its characteristics, not its label" (citation omitted)).
A district court has broad discretion in determining child support and will be reversed for abuse of discretion only if there is a "clearly erroneous conclusion * * * against logic and the facts on record." McNulty v. McNulty, 495 N.W.2d 471, 472 (Minn.App. 1993). Where neither party has sole physical custody, we require district courts to apply the Hortis/Valento formula to set child-support obligations when a noncustodial parent provides a significant amount of physical care for his or her children. Blonigen v. Blonigen, 621 N.W.2d 276, 282 (Minn.App. 2001); see also Rogers v. Rogers, 622 N.W.2d 813, 821 n. 19 (Minn. 2001) (expressing no opinion regarding whether formula is appropriate to joint-custody situations). Although there is no rule for what constitutes a significant amount of physical care, we have upheld the use of the Hortis/Valento formula in "all joint custody situations," including one similar to the present case where one party had primary physical custody. Pavlasek v. Pavlasek, 415 N.W.2d 42, 45 (Minn.App. 1987).
Here, the district court recognized that Z.C. spends nearly equal time with each party and thus reduced respondent's obligation accordingly. Although we agree with appellant that there is no bright-line rule for applying the Hortis/Valento formula, we have upheld application of the formula where the parties' responsibilities were less equal. See, e.g., id. at 44 (upholding deviation from guidelines and application of formula where one party had primary physical custody 55% of the time, and the other party had primary physical custody 45% of the time). Therefore, we find that the district court did not abuse its discretion by applying the formula.
III
Finally, appellant argues that the district court erred by determining how much insurance respondent must obtain to cover Z.C. Minnesota law requires every child-support order to "expressly assign * * * the responsibility for maintaining medical insurance for the minor children." Minn. Stat. § 518.171 (2000). The medical needs of a minor child, including insurance coverage, "are in the nature of child support." Korf v. Korf, 553 N.W.2d 706, 708 (Minn.App. 1996) (citations omitted). The district court has discretion in determining such obligations, and its decision will not be reversed absent an abuse of discretion. Casper v. Casper, 593 N.W.2d 709, 714 (Minn.App. 1999). Generally, a trial court should not consider an obligor's responsibilities to subsequent children when determining the obligation to prior children. Hayes v. Hayes, 473 N.W.2d 364, 366 (Minn.App. 1991). When determining child support, the trial court can consider the obligor's burden to support subsequent children only if it makes specific factual findings. Minn. Stat. § 518.551, subd. 5f (2000); see also Bock v. Bock, 506 N.W.2d 321, 324 (Minn.App. 1993). Even after making such findings, placing "excessive deference" or weight on an obligor's subsequent burden constitutes an abuse of the trial court's discretion. Hayes, 473 N.W.2d at 365.
Here, the court held that respondent must continue to maintain medical insurance for Z.C., but not at a greater cost than he pays to maintain coverage for his second family. Although the language suggests that respondent must merely maintain the same amount of insurance for Z.C. as he does for his new child, the language could also be construed to mean that respondent could provide less insurance for Z.C. than he does for his second family. If construed in such a way, respondent's new obligation would take precedence over his prior obligations to Z.C., and would be an abuse of discretion. See id. at 366.
There are no findings to indicate that maintaining additional insurance somehow creates a hardship for respondent. See Hedburg v. Hedburg, 412 N.W.2d 43, 46 (Minn.App. 1987). In fact, the findings suggest the opposite: respondent testified that the insurance he receives through his employer covers his new family, Z.C., and even N.C. Because this insurance policy is so expansive, we cannot say that respondent faces any burden regarding his insurance obligations. Therefore, we reverse and remand on this issue.