Opinion
FBTFA074021794S
12-28-2018
Jonathan FARBER v. Anna FARBER
UNPUBLISHED OPINION
OPINION
WENZEL, J.
This action comes before the court on the order of the court (Sommer, J.) setting the action down for an evidentiary hearing to determine the need of the minor children of the parties for support. The evidentiary hearing was held and, after submission of post-hearing briefs, submitted to the court. Before addressing the findings of fact and conclusions of law made by the court as a result of the hearing, it would be helpful to review how this matter came to the hearing.
The marriage of the parties was dissolved by decree of the court on October 31, 2008. The Judgment of the court (# 159) incorporated the terms of a Stipulation for Judgment ("Stipulation") which was attached to the Judgment. The Stipulation provided that the plaintiff ("Husband") would pay unallocated alimony and child support to the defendant ("Wife") at the rate of $ 83, 333.33 per month for the initial four years following the decree, and then at the rate of $ 50, 000 for an additional two years. These support payments were not subject to modification as to the term or amount. The expiration of these support payments was set for November 1, 2014. In paragraph 13 of the Stipulation, the parties stated, "At that time, [November 1, 2014] the plaintiff shall pay child support as the parties may agree, or, failing that agreement, as the court may determine."
Of note, the Stipulation also provided for the allocation of apparently substantial assets and property between the parties and imposed on the Husband continuing obligations to pay for all healthcare and medical expenses of the three children born of the marriage as well as all educational expenses of the children until they reach the age of 23. The three children of the marriage are now aged 17, with twins who are 14 years old.
On December 8, 2014, the Wife filed a Motion to Establish Child Support (# 192) seeking a hearing to determine child support for the three minor children and granting reasonable discovery to prosecute that claim. That motion was served on the Husband on December 19, 2014. On January 16, 2015, the Husband filed a Motion for Protective Order (# 195). The motion sought "a protective order prohibiting the [Wife] from seeking discovery into [the Husband’s] financial assets unless and until she establishes that the children on behalf of whom she seeks child support are ‘in need of maintenance, ’ ... and the court has the power to proceed in a child support proceeding." On that same date, the Husband filed his Objection to Defendant’s Motion to Modify Child Support (# 197). Both of the Husband’s motions were supported by legal arguments essentially the same. The Husband argued, in essence, that the statutory grant of authority under General Statute § 46b-84 was conditioned upon a finding that a minor child was in need of support before the court could order child support. Given the substantial payments for support made by the Husband to date, his obligation to pay all medical and educational expenses of the children, and most importantly, the existence of a trust then being created by the Husband for the benefit of the three minor children, the Husband argued, the children were not in need of maintenance. Moreover, given the absence of need, any discovery sought by the Wife of the Husband’s financial affairs, discovery was unnecessary, would be invasive of the Husband’s right to privacy and only served the Wife’s interest in snooping into the Husband’s financial affairs.
The court’s recitation of legal arguments by both parties is admittedly summary in nature and intended only to be descriptive, given the subsequent rulings by the court (Sommer, J.). This court will further analyze such legal issues as needed in light of the evidentiary hearing and findings.
After extensive briefing and oral argument, the court (Sommer, J.) entered an Order (# 207) ("Order") finding that "a court must determine whether a child is in need before it orders child support." The court further adopted the exception described in Slaughter v Slaughter, 312 S.W.2d 193, 196 (Mo.Ct.App. 1958), that "the only exception" to a parent’s obligation of support would be where a parent has created a trust fund for the express purpose of maintenance of the minor children. Given the Husband’s contention that the needs of the children would be satisfied by the trust fund he had established, the court granted the Husband’s motion for a protective order, pending a determination as to whether "the funds in the trust suffice to satisfy the children’s needs."
The Wife then filed a Motion for Reargument (# 208) asking the court to further consider the matter in light of some specific concerns. While the court’s Decision Re Reargument (# 227) ("Decision") did not grant reargument, it did clarify some aspects of the prior ruling. First the court clarified that its Order had not made any factual findings, simply assessed the legal arguments made by the parties. In fact, the court had "ordered a hearing to determine a factual basis for whether the children are in need of maintenance." Finally, the court clarified that whether the claimed trust would generate sufficient income to meet the needs of the children would not be the sole issue for determination. Rather, "the court must consider all of the statutory factors described in Section 46b-84(d) as set forth in Maturo [v. Maturo 296 Conn. 80 (2010) ]." Decision, at 4.
These factors are: "[T]he age, health, station, occupation, earning capacity, amount and sources of income, estate, vocational skills and employability of each of the parents, and the age, health, station, occupation, educational status and expectation, amount and sources of income, vocational skills, employability, estate and needs of the child."
On October 31, 2018, the matter came before this court for the purpose of conducting the "needs hearing." As a preliminary matter, the court inquired as to which party would go forward, that is which party had the burden of proof on the issue of need. While the Order concerning the requested protective order (# 207) established the Wife "has the burden of establishing that the discovery [sought] is reasonably necessary," this did not resolve the issue as to the burden of proof on the issue of need. After some discussion, and apparent reluctance on the part of either counsel to admit a burden of proof, the court ordered that the Husband would have the burden of going forward to present evidence as to the absence of need.
This decision was based on the right of minor children to support and maintenance from their parents, which has long been recognized in Connecticut. It has been described as both a common-law and statutory duty. Pezas v. Pezas, 151 Conn. 611, 616 (1964). In this case, the Husband has never argued that he is free from child support as a general matter. He admittedly provides it now for the children’s educational and medical needs and the Stipulation provides that, upon cessation of the unallocated payments, "the [Husband] shall pay child support." Rather, he has always argued that based on his obligations under the Stipulation to bear all educational and medical expenses of the children and the existence of a substantial trust available for the satisfaction of such needs, there is, in this particular case, no need for support. In Fitzgerald v Fitzgerald, 169 Conn. 147, 152 (1975), the Connecticut Supreme Court stated, "The primary duty of the parent to support his minor children, if he is able to do so, is not relieved by the fact that they may have income from a trust created in their favor." (citing Slaughter v Slaughter, 313 S.W.2d 193 (1958). In its Order, the court (Sommer, J.) found this and other language in Fitzgerald necessarily incorporated "[t]he only exception to this rule [which] is where, under a trust ... a fund is created for the express purpose of maintenance and education of the minor child or children. In such cases, the application of the property or income for that purpose must be made without regard to the ability of parents to support said minors." 313 S.W.2d at 196. Given that the Husband here has claimed it is the existence of the Trust which prevents a finding of need and the express language in the Order which states that a trust established for maintenance is an "exception" to a parent’s obligation of support, the court held that the Husband had, at least in this case, the burden of going forward with the evidence on the issue of need.
In the Order, this language was quoted by the court, at page 3.
The court also sees nothing in the language of § 46b-84(a), the prior rulings of this court or the language in Fitzgerald which is inconsistent with a reading of the statute that treats the need of every child in this state to support from his or her parents as a rebutable presumption.
At the hearing, the evidence showed as follows. On January 16, 2015, the Husband created a trust, styled the 2015 Children’s Trust Agreement (the "Trust"). A copy of the Trust instrument was placed in evidence. The Trust instrument named the three minor children of the parties as beneficiaries. The Trust instrument indicates that while the Trust allows the trustee to make distributions to any of these beneficiaries in such amounts as he may determine, "in his reasonable discretion," are necessary for their maintenance and support, it does not require the trustee to exercise that discretion at any point.
The trustee of this trust testified as well. He testified that the approximate value of the trust corpus was two million dollars, but there was no evidence as to how the corpus was invested. The trustee testified that his understanding of the trust instrument was that he had "unfettered discretion" to make or not make any distributions to the minor children of this marriage. In the almost four years since the creation of the Trust, no distributions had ever been made to any of the minor children. Moreover, the trustee does not undertake any efforts to determine what the reasonable needs of the beneficiaries of the Trust are, but rather assumes that if the existing sources of support, i.e., the parents, are not adequate, it will be brought to his attention. He described the role of the trust as a resource available for "exigencies," that is, available for support of the children where their needs were not otherwise being met.
Also at the hearing, there was no evidence submitted to show that any of the three children in question possessed any income or assets of their own, had any earning potential or had any source of support other than their parents. The evidence further showed that each of the parents did in fact provide maintenance for the children by way of housing, food, clothes and transportation. In fact, at one point in the hearing both parties agreed that each parent provides support and maintenance for the children whenever those children are with that parent. There was no evidence submitted as to the amount or nature of the parents’ financial resources. There was evidence that the Husband was obligated to pay for all of the children’s health and educational expenses and that he had in fact done so in the past.
Based on this evidence, the court finds that the minor children of this couple are in fact in need of maintenance. Regardless of any consideration of a burden to go forward with the evidence, the undisputed evidence and the stipulation of the parties proves the children in fact are in need of at least some support. These needs are evidenced by the undisputed testimony that the children are provided clothing, food and shelter directly from their parents and the absence of any evidence that such needs are met from any other source or the children themselves have any income or assets for their own support.
Another problem with the sufficiency of the evidence presented at the hearing was that the evidence here was devoid of any information as to the current income, assets, earning potential or financial resources of the parents. Neither parent presented any financial affidavits, financial records or other evidence on these topics. The parents also did not present any level of detail as to what amounts were in fact being spent to maintain their children. The statute also directs that the court shall consider several particulars about the children. Other than their age and status as students, no information was presented. Specifically, there was no evidence that any of the children had their own assets, sources of income or earning potential.
The only evidence within the ambit of the statute was that the Husband was a healthy, 50-year-old man whose occupation was as an investment manager. Such evidence provided no real help to the court in resolving the question of need.
At best this court understands, the current argument of the Husband is not so much that the children are not in need of maintenance and support, but rather that there are not any "unmet needs" of the children. The only evidence in this regard was the conclusory testimony of the Wife that there were no "unmet needs" of the children, because she paid for everything they needed. This argument was addressed and rejected by the Appellate Court in Gibbons v. Gibbons, 139 Conn.App. 1, 7-8 (2012). While, under § 46b-84, a court must determine if a minor child is in need of support before it orders child support, it must determine what "the needs of the child" are by reference to the factors set out in § 46b-84(d) before it can say whether or not such needs exist. 139 Conn.App. at 7-8. This is because "[t]he ‘needs of the child’ is a very broad concept which may have some flexibility of meaning depending upon the particular case." A. Rutkin, et al., 8 Conn. Practice Series: Family Law and Practice (2010) § 38:13, at 302. (Cited with approval in Gibbons, 139 Conn.App. at 7.) Such needs may well include "various extras and luxuries depending upon the financial circumstances of the parents and the lifestyle which has been established." 39 Conn.App. at 7. Here, there was no evidence as to the relevant factors which this court must consider in determining what the needs of the children are. If that information is needed to determine the needs of the children, it leaves the court, which has already determined the children are in need of some support, unable to determine if such needs continue.
The Father’s contention throughout the Mother’s motion to determine child support has been that there is no need for support because of the existence of the Trust. And it is to this contention that the court now turns.
The evidence presented here shows only that, at the moment of the trustee’s testimony, there were substantial assets in the Trust. The evidence also shows that, in his sole discretion, the trustee has the power to make distributions to the children, how and when he might choose to do so. There is no requirement that the trust ever distribute a single dollar for support of any minor child. The Trust does not require this and the trustee does not understand he has any duty to do so. The trustee makes no effort to monitor the needs of the children and he has not ever made a distribution for the benefit of the minor children during the existence of the Trust. The trustee slated that the Trust was available "should exigencies arise," that is only where the "health, education and welfare "of the children are not being met through other means." His conduct over the past four years exemplifies this. This evidence alone precludes the Trust from meeting the requirements for the Slaughter exception. Slaughter stated that its exception required "a fund created for the express purpose of maintenance ... of the minor child and that the application of the property or income for that purpose must be made without regard to the ability of parents to support said minors." 313 S.W.2d at 196 (emphasis added). Yet, the Trust here does not require any payments for maintenance of minor children and distributions are not made without regard to the ability of the parents to support the minors. Even if this testimony could be read as somehow compatible with Slaughter, the court finds the Trust is not sufficient to satisfy the need of the children for maintenance because it has not to date provided, and may or may not ever provide, any support for the children. The fact that it has, at the moment, substantial corpus, is not meaningful in light of the trustee’s discretion whether or not to distribute anything.
It should be noted here that when the fund considered in Slaughter did not meet the standard cited, the exception claimed there was denied and the father ordered to pay child support.
Any argument that if the Wife, who has clearly moved to obtain child support, really wanted support for the children, she need only go to the trustee appointed by the Husband and ask for it, does not preclude the court’s finding that the minor children are in need of support. The minor children here are the interested parties. They are the ones entitled to support under the law. If, for reasons that can become all too apparent in family disputes, one parent wishes to obtain support through the process established by law, rather than the process established by their former spouse, that should not deprive the children of their right to an adequate level of support.
After considering all the evidence presented, the court finds that the Trust does not preclude a finding that the children are in need of maintenance. Accordingly, this court determines that the minor children of this marriage are in need of maintenance and support.
The court notes that in conducting this hearing, the court has attempted to faithfully follow the prior rulings of the court, particularly the Order and Decision. Despite arguments presented in association with the hearing, the court has not reconsidered issues such as whether Fitzgerald is properly read as incorporating the exception addressed in Slaughter or whether Connecticut’s adoption of the Child Support Guidelines requires evidence of the parents’ financial condition before a determination of need can be made. The court has simply conducted an evidentiary hearing and determined that under § 46b-84, the children are in need of maintenance.
It may be helpful here to recall the context and purpose of this hearing. It was ordered in light of the Husband’s motion for protective order barring discovery of his financial condition. In light of the court’s findings here, the court here partially lifts the prior order of the court which granted a "protective order as to disclosure of the Husband’s personal and business financial assets other than the terms and amount of the trust."
Notwithstanding the above order, it appears to the court that given the expected parameters of the parties’ financial circumstances, it may not be helpful for the court to now preclude other specific and detailed applications for a protective order or for allowing either side to propose alternative methods of discovery or compliance in light of their interests for privacy or avoiding burdensome or oppressive discovery requests. The court is mindful in this regard that the parties seemingly assume this may well be an instance where reference to the Connecticut Child Support and Arrearage Guidelines will result in combined net weekly income in excess of the $ 4, 000 and require a case specific determination by the court, consistent with statutory criteria. It is also possible that evidence of criteria strongly suggesting deviation from the guidelines may be found to exist. Such possibilities may well result in a situation where the discretion afforded the court renders exhaustive or arguably obtrusive discovery of minimal help and increasing burden.
In order to honor these competing concerns, the lifting of the prior order shall at this time be limited to requiring that, within 21 days of this order, each side shall exchange sworn financial statements substantially in accord with the forms prescribed by the chief court administrator. These forms shall be held in confidence by the receiving party, and the information contained therein not further disseminated. All such information may only be used for the purpose of the pending action.
Within 21 days of the exchange of such financial affidavits, the parties shall propose and exchange all other further discovery requests they may reasonably propose with regard to the Wife’s motion to determine child support. The parties may comply with those requests or promptly file objections and set such objections down for hearing before the court.
Upon review of the exchanged financial affidavits, any further discovery or evidence and argument, including Worksheets under § 46b-215a-6 of the Regulations, Connecticut State Agencies (which each party is ordered to submit at the time of hearing), the court will order any further discovery compliance and set the Wife’s motion for determination of child support down for hearing.