Opinion
No. C2-02-1921.
Filed June 24, 2003.
Appeal from the Hennepin County District Court, File No. PA37448.
Anthony J. Kerschbaum, Kerschbaum Law Office, (for appellant)
Amy Klobuchar, Hennepin County Attorney, Thomas L. Aarestad, Assistant County Attorney, (for respondent Hennepin County)
Nancy Lea Bohn, (pro se respondent)
Considered and decided by Lansing, Presiding Judge, Peterson, Judge, and Wright, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
In this appeal from an order modifying a child-support obligation, appellant Thomas Peters contends that the child support magistrate (CSM) erred in calculating his monthly net income. Specifically, appellant claims that the CSM (1) incorrectly calculated the monthly tax obligation to be deducted from his monthly gross income, (2) failed to consider appellant's obligation to support his subsequent children, (3) ordered appellant to pay for double health insurance coverage, and (4) failed to deduct from appellant's gross monthly income the cost of dependent health-insurance coverage. We reverse and remand.
FACTS
On July 24, 1997, Peters was adjudicated the father of M.B., who was born in 1986, and ordered to pay child support. Based on his monthly net income of $1,669 and M.B.'s needs, Peters's child-support obligation was set at $417 per month, plus $37.50 per month for medical support. Pursuant to the 1997 order, on January 1, 1998, Peters's child-support obligation increased to $426 per month and his monthly medical-support payment terminated upon M.B. receiving dependent-health-insurance coverage through Peters's employer. Peters subsequently fathered two children with a person other than M.B.'s mother.
In July 2001, Nancy L. Bohn, M.B.'s mother, moved to increase Peters's child-support obligation. At the hearing on the motion, Peters testified and presented his 2000 state and federal income-tax returns and two pay stubs from August and September 2001. As to Peters's monthly net income, the CSM found:
The Obligor's net monthly income excluding overtime and the lump sum payment is $4,827.35, after the following deductions:
$560.00 for federal and state taxes and social security at married with four deductions based upon an adjusted gross income reached after deducting itemized deduction and pension.
$58.48 for union dues.
$348.00 for pension.
$7.04 for life insurance.
$21.13 for long term disability.
The CSM determined that Peters's earnings had increased substantially and an increase in his child-support obligation is warranted. Noting that the child-support obligation is not a deviation from the guidelines, the CSM ordered Peters to pay $1,207 per month as ongoing child support but reduced that amount to $1,182 to adjust for past overpayments. Peters was also ordered to pay $36 per month toward health-insurance coverage for M.B.
In an amended order of September 3, 2002, the CSM clarified her rationale for apportioning health insurance between the parties. The CSM determined that, while both parents provide medical insurance for M.B., Peters pays no additional cost for the insurance he provides, while Bohn's health-insurance expense for M.B. is $58.75. The CSM concluded that $36 is Peters's proportionate share of the medical-insurance cost for M.B. This appeal followed.
DECISION
Under Minn.R.Gen.Pract. 378.01, a party can appeal directly from the CSM's original decision without moving for review of the decision under Minn.R.Gen.Pract. 376.01. Because appellant did not obtain this review, our scope of review is limited to whether the evidence supports the findings of fact and whether the findings of fact support the conclusions of law and judgment. See Davis v. Davis, 631 N.W.2d 822, 825 (Minn.App. 2001) (stating that "not seeking review limits the scope of review on appeal to whether the evidence supports the findings and whether the findings support the conclusions and the judgment"); Minn.R.Gen.Pract. 378.01 advisory comm. cmt. (stating that "if a party chooses the option of appealing directly to the court of appeals without first bringing a motion for review, such an appeal will be limited to determining whether the evidence sustains the findings of fact (to which the `clearly erroneous' standard of review applies) and whether the findings support the conclusions of law and the judgment").
Regardless of whether appellant obtained review under Minn R. Gen. Pract. 376.01, we apply the same standard of review as we would apply on appeal from the district court's child-support determination. See Brazinsky v. Brazinsky, 610 N.W.2d 707, 710 (Minn.App. 2000). We will not alter a district court's factual finding unless it is "clearly erroneous." Minn.R.Civ.P. 52.01.
A finding is "clearly erroneous" if the reviewing court is "left with the definite and firm conviction that a mistake has been made." When determining whether findings are clearly erroneous, the appellate court views the record in the light most favorable to the trial court's findings. Also appellate courts defer to trial court credibility determinations.
Vangsness v. Vangsness, 607 N.W.2d 468, 472 (Minn.App. 2000) (citations omitted). The district court's findings are not clearly erroneous simply because the record supports findings other than those the district court made. Id. at 474.
A. Child-Support Modification
The child-support guidelines are presumptively applicable in all child-support cases. Minn. Stat. § 518.551, subd. 5(i) (2002). Under the guidelines, the presumptively correct child-support obligation is calculated by multiplying an obligor's net income by the percentage specified in the guidelines. Id., subd. 5(b) (2002). "Net income" is defined as the obligor's total monthly income after deducting
Federal Income Tax
State Income Tax
Social Security Deductions
Reasonable Pension Deductions
Union Dues
Cost of Dependent Health Insurance Coverage
Cost of Individual or Group Health/Hospitalization Coverage or an Amount for Actual Medical Expenses [and]
A Child Support or Maintenance Order that is Currently Being Paid
Id.
Peters argues that his modified child-support obligation is based on clearly erroneous factual findings. Specifically, Peters contends that, in calculating his monthly net income, the CSM deducted $560, which is less than the actual amount of his monthly tax obligation. Peters provides two alternative calculations for his monthly tax obligation. Using a 2001 bi-weekly pay stub (excluding overtime and lump-sum payments), Peters adds his federal tax, state tax, Medicare tax, and social security deductions, multiplies the sum by 26 (pay periods per year), and divides that number by 12 (months) to arrive at a total monthly tax obligation of $1,255.71. Alternatively, using his 2000 federal income-tax return, Peters adds his federal tax, state tax, Medicare tax, and social security deductions, subtracts his federal and state tax refunds, and then divides that number by 12 (months) to arrive at a total monthly tax obligation of $1,259. Using either method, Peters's monthly tax obligation is more than twice the amount calculated by the CSM.
The CSM calculated a monthly net income of $4,827.35 for Peters by deducting amounts for federal and state income taxes, social security insurance, union dues, pension deductions, life-insurance costs, and long-term disability costs. But the CSM did not deduct Peters's Medicare payments and current child-support obligation for M.B. and erroneously allowed deductions for life-insurance and long-term-disability payments that are not authorized by Minn. Stat. § 518.551, subd. 5(b) (defining net income). Moreover, the CSM's findings do not explain the source from which she derived Peters's monthly tax obligation of $560. We are unable to reconcile the CSM's findings with the evidence relating to Peters's monthly income. The record contains two sources from which Peters's income could be derived his 2000 tax return and his 2001 pay stubs. The CSM's findings do not specify the source from which she calculates Peters's monthly net income. Insufficient findings preclude a meaningful review of the child-support modification to determine whether the evidence supports the findings of fact. Bliss v. Bliss, 493 N.W.2d 583, 590 (Minn.App. 1992), review denied (Minn. Feb. 12, 1993). Because Peters's child-support obligation must be based on an accurate calculation of his monthly net income, we remand for a determination of Peters's net income as defined by Minn. Stat. § 518.551, subd. 5(b), supported by explicit findings as to each element of the calculation.
B. Subsequently Born Children
Peters next argues that, in setting his child-support obligation, the CSM failed to account for his obligation to his subsequent children. The needs of subsequent children shall not be factored into a child-support-guidelines calculation, and the fact that an obligor has subsequent children after the entry of a child-support order is not a basis for a modification to decrease child support. Minn. Stat. § 518.551, subd. 5f (2002). "[T]he fact that an obligor has subsequent children shall be considered in response to a request by an obligee for a modification to increase child support." Id.; see also In re Paternity of J.M.V., 656 N.W.2d 558, 563 (Minn.App. 2003) (remanding support order because district court merely approved parties' stipulations without considering subsequent children), review denied (Minn. Apr. 29, 2003). But to deviate upward from the child-support guidelines, the district court must consider the obligor's income and reasonable expenses to determine the obligor's "total ability to contribute to dependent children." Minn. Stat. § 518.551, subd. 5f. Specific findings justifying the deviation must be made. Id.
Here, the CSM increased Peters's child-support obligation to $1,182 and stated, "[t]he child support amount ordered is not a deviation from the Minnesota Child Support Guidelines." (Emphasis added). In considering the impact of Peters's support of subsequent children, the CSM determined that
[Peters] has sufficient income to provide support for the minor child at guideline and to meet the needs of his household. The child can not be asked to set aside her needs in order to allow Obligor to live a higher standard of living. The Obligor's lump sum payment as well as overtime income are additional resources available to his household.
In light of our determination that the evidence in the record does not support the findings regarding Peters's monthly net income, on remand, the CSM will again be required to consider the needs of subsequent children and determine whether any deviation from the guidelines is appropriate when setting Peters's child-support obligation.
Medical Insurance Premiums
Peters argues that the CSM abused its discretion by (1) ordering him to pay a portion of Bohn's health-insurance expense that is attributable to M.B. and (2) failing to deduct that amount from Peters's monthly net income. Every child-support order must "expressly assign or reserve the responsibility for maintaining medical insurance for minor children and the division of uninsured medical and dental costs." Minn. Stat. § 518.171, subd. 1(a)(1) (2002). The district court must also order the party with the better dependent health-and-dental-insurance coverage available on a group basis or through an employer or union to name the minor child as a beneficiary. Id., subd. 1(a)(2) (2002). In doing so,
if the court finds that the obligee is not receiving public assistance for the child and has the financial ability to contribute to the cost of medical and dental expenses for the child, including the cost of insurance, the court shall order the obligee and obligor to each assume a portion of these expenses based on their proportionate share of their total net income as defined in section 518.551, subdivision 5.
Id., subd. 1(d) (2002).
Here, the CSM's order required both parties to maintain health insurance for M.B. The CSM determined that Peters provided health insurance for M.B. at no additional cost and that $58.75, or one-fourth of Bohn's health-insurance expense, was attributable to insuring M.B. The CSM apportioned the cost of Bohn's health insurance for M.B. between the parties based on their monthly net income. Because Peters's income is 60 percent of the total net income calculated for both parties, the CSM ordered him to pay $36, or 62 percent of Bohn's health-insurance expense attributable to M.B., and 60 percent of M.B.'s unreimbursed medical, dental, vision, counseling, and orthodontia expenses.
From our review of the record, we conclude that the CSM abused her discretion by apportioning health-insurance expenses paid by Bohn for M.B. without first making a factual determination that Bohn's insurance coverage for M.B. is superior to Peters's insurance. Id., subd. 1(a)(2). Likewise, it was an abuse of discretion not to deduct medical-insurance costs for M.B. from Peters's gross income to calculate his monthly net income. Minn. Stat. § 518.551, subd. 5(b)(vi). On remand, the CSM shall assign medical-insurance coverage for M.B. pursuant to Minn. Stat. § 518.171, subd. 1(a)(2), determine the proportionate share of the cost for Peters and Bohn based on a correctly calculated monthly net income, deduct that amount from the obligor's monthly gross income, and make findings to support each determination.