Opinion
No. FA 08 4034983
November 24, 2010
MEMORANDUM OF DECISION
I
BACKGROUND
The defendant filed motion No. 144 on June 1, 2010, to modify his weekly child support payments of $240, claiming a substantial change in circumstances. The parties have stipulated to the facts upon which the court is to decide whether there has been a substantial change in the income of both parties and the cost of insurance, giving rise to the defendant's claim for a reduction in his child support payments pursuant to the Child Support Guidelines.
II
FACTS
The parties have stipulated to the relevant facts in this case is, as follows: "The marriage of the parties was dissolved by the Court, Epstein, J., on March 13, 2009. The judgment incorporated a separation agreement entered into by the parties. The parties have two minor children. Primary residence of the minor children is with the plaintiff. Under the agreement, the defendant is required to pay child support to the plaintiff in the amount of $240 per week.
"At the time of dissolution, the plaintiff, Laura Ciemniewski, worked at General Re New England Asset Management, Inc., (hereinafter `General Re'). The plaintiff earned $67,696.50 in 2009.
"On or about January 22, 2010, the plaintiff entered into an `Agreement and General Release' with General Re. The plaintiff would testify that in exchange for the release of a sexual harassment claim against General Re, she would be receiving $57,050 in semi-monthly installments from March 16, 2010 through March 15, 2011. As part of the Agreement, the plaintiff also received a `bonus' of $10,000. The receipt of these funds, however, required the plaintiff to `knowingly and voluntarily [release] and forever [discharge] the Company, the parent corporations, affiliates, subsidiaries, divisions, predecessor organizations, successors and assigns, and the current and former employees, officers, directors, attorneys and agents thereof . . . in their official and individual capacities from any and all claims, known and unknown, against the Company, which Employee, his/her heirs, executors, administrators, successors and assigns . . . have or may have as of the date of execution of this Agreement and General Release . . .'
"The plaintiff commenced a full-time position at White Mountain Advisors on March 29, 2010. At White Mountain, the plaintiff earns $75,000 per year. The plaintiff is also eligible for an annual bonus, but has not yet received one. See Plaintiff's financial affidavit.
"The defendant, John Ciemniewski, presently earns $70,824 per year. See Defendant's financial affidavit.
"On June 14, 2010, the defendant served the plaintiff with a motion to modify his child support obligation. The defendant alleges a substantial change of circumstances, specifically that the plaintiff earns greater income and that the defendant earns less than when the original orders entered; and that the defendant's health insurance premium has increased.
"A review of the child support guidelines at the time of dissolution state that the plaintiff was earning $1,058 per week and the defendant was earning $1,850 per week.
"The child support guidelines submitted at the time of dissolution indicate that medical/hospital/dental premiums for the parents and dependents were $30 paid by the plaintiff and $54 paid by the defendant.
"The child support guidelines submitted at the time of the dissolution resulted in a child support obligation on the part of the defendant of $240 per week with unreimbursed medical expenses being split 50% to mother and 50% to father."
III
DISCUSSION
According to the stipulation of the parties, the plaintiff would testify that the $57,050 payment she receives in semi-monthly installments is a settlement of her legal claim for workplace sexual harassment. Although no other facts or allegations to the contrary are stipulated by the parties, the defendant claims in his brief that these semi-monthly payments are taxable as income to the plaintiff. However, based upon the record before the court, these semi-monthly installments are neither characterized as a claim for lost wages nor as severance pay. The court must first consider whether these payments are within the definition of gross income pursuant to the Child Support Guidelines (Guidelines). The Guidelines' definition of gross income, codified at § 46b-215a-1(11), does not specifically include or exclude awards of damages for personal injury or tort claims as income for the purpose of determining child support. Although severance pay and benefits received in place of earned income are includable as gross income, as provided at subsections (iv) (viii), respectively, of the cited regulation, there is no evidence in the record that these funds are severance payments, other than by implication in their timing and duration and the relatively generic language of the waiver signed by the plaintiff as a condition of receiving the $57,050 payment.
Connecticut State Regulations § 46b-215a-1(11) provides: "`Gross income' means the average weekly earned and unearned income from all sources before deductions, including but not limited to the items listed in subparagraph (A) of this subdivision, but excluding the items listed in subparagraph (B) of this subdivision. (A) Inclusions. The gross income inclusions are: (i) salary; (ii) hourly wages for regular, overtime and additional employment not to exceed 45 total paid hours per week; (iii) commissions, bonuses and tips; (iv) profit sharing, deferred compensation and severance pay; (v) tribal stipends and incentives; (vi) employment perquisites and in-kind compensation (any basic maintenance or special need such as food, shelter or transportation provided on a recurrent basis in lieu of or in addition to salary or wages); (vii) military personnel fringe benefit payments; (viii) benefits received in place of earned income including, but not limited to, workers' compensation benefits, unemployment insurance benefits, strike pay and disability insurance benefits; (ix) veterans' benefits; (x) social security benefits (excluding Supplemental Security Income (SSI) for a parent or a child), including dependency benefits on the earnings record of an insured parent that are paid on behalf of a child whose support is being determined; (xi) net proceeds from contractual agreements; (xii) pension and retirement income; (xiii) rental income after deduction of reasonable and necessary expenses; (xiv) estate or trust income; (xv) royalties; (xvi) interest, dividends and annuities; (xvii) self-employment earnings, after deduction of all reasonable and necessary business expenses; (xviii) alimony being paid by an individual who is not a party to the support determination; (xix) adoption subsidy benefits received by the custodial parent for the child whose support is being determined; (xx) lottery and gambling winnings, prizes and regularly recurring gifts (except as provided in subparagraph (B)(v) of this subdivision); and (xxi) education grants (including fellowships or subsidies, to the extent taxable as income under the Internal Revenue Code). (B) Exclusions. The gross income exclusions are: (i) support received on behalf of a child who is living in the home of the parent whose income is being determined; (ii) SSI payments, including those received on behalf of a child who is living in the home of the parent whose income is being determined; (iii) federal, state and local public assistance grants; (iv) earned income tax credit; and (v) the income and regularly recurring contributions or gifts of a spouse or domestic partner."
By a preponderance of the evidence, the court concludes that the compensation to the plaintiff in this case is in exchange for her waiver of a claim for sexual harassment and did not include a component for loss of income. As such, this compensation for damages is not includable in the definition of gross income for purposes of child support. Contra, Fabiano v. Fabiano, 10 Conn.App. 466, 523 A.2d 937 (1987). The court further concludes that, under the facts of this case, it would be unjust and inequitable for the court to construe the Guideline definition of income to include compensation for such damages.
In Fabiano v. Fabiano, CT Page 22874 10 Conn.App. 466, 523 A.2d 937, 939 (1987), the Appellate Court addressed the question of whether a personal injury award represents compensation for physical injuries. The court held that "[w]hile that may be true, it does not mean that such an award is precluded from consideration as part of the sources of income and estate . . . of the recipient of the award, which factors are to be considered upon a motion for modification of support." Id. at 471. However, the court notes this decision predates the promulgation of the Child Support Guidelines, containing a definition of gross income.
In addition to the $57,050 payment for damages, the plaintiff additionally received a bonus of $10,000. Based upon the record presented, this bonus is a one-time occurrence and although the plaintiff is eligible for a bonus at her new place of employment, she has yet to receive one. Our Supreme Court has recently addressed the question of whether inconsistent bonus income is includable in gross income for the purpose of a determination of child support pursuant to the Guidelines. In Maturo v. Maturo, 296 Conn. 80, 995 A.2d 1 (2010), the court held that "[w]hen there is a history of wildly fluctuating bonuses, however, or a reasonable expectation that future bonuses will vary substantially, as in the present case, an award based on a fixed percentage of the net cash bonus is impermissible unless it can be linked to the child's characteristics and demonstrated needs." Id. at p. 106.
In the present case, there has been no evidence presented concerning a history or reasonable assurance of future bonuses. The court therefore considers the $10,000 bonus paid to the plaintiff to be an isolated incident and not the source of a steady stream of income or revenue for purposes of the Guidelines. See Gay v. Gay, 266 Conn. 641, 647, 835 A.2d 1 (2003) (capital gains do not generally represent a steady stream of revenue). Based upon the facts and applicable law, the court finds no basis to include this one-time bonus as gross income for purposes of child support.
Immediately after leaving her employment with General Re, the plaintiff obtained new employment with an increased annualized salary of $75,000.
At the time of dissolution, the current weekly child support order of $240 was established pursuant to the Guidelines. At that time, the plaintiff was earning $1,058 per week and the defendant was earning $1,850 per week. In addition, the medical/hospital/dental premiums were $30 paid by the plaintiff and $54 paid by the defendant. Based upon the findings of the court, the plaintiff receives gross weekly income of $1,442 and the defendant receives gross weekly income of $1,528. In addition, the defendant now pays $80 for medical and dental expenses according to his current financial affidavit.
Using these figures, the presumptive amount of weekly child support is $222 pursuant to the Guidelines. When compared with the current child support of $240, the difference between the two is $18 or less than 8%. Pursuant to General Statutes § 46b-86, "[t]here shall be a rebuttable presumption that any deviation of less than fifteen per cent from the child support guidelines is not substantial and any deviation of fifteen per cent or more from the guidelines is substantial . . ." Although the incomes of the parties have changed substantially, the presumptive amount of child support pursuant to the Guidelines has not changed substantially. Therefore, the motion to modify child support is denied.
SO ORDERED