Opinion
No. C7-99-2115.
Filed August 1, 2000.
Appeal from the District Court, Chisago County, File No. F794141.
Steven A. Sicheneder, (for respondent)
Robert A. Manson, (for appellant)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1998).
UNPUBLISHED OPINION
On appeal from the district court's order in a postdissolution modification proceeding, appellant Mark Saxton O'Donnell argues the court abused its discretion by (1) determining that appellant was self-limiting his income; (2) denying appellant's motion to reduce child support and maintenance; (3) awarding partial attorney fees to respondent; and (4) holding appellant in conditional contempt. Respondent Laura Elizabeth O'Donnell challenges the amount of the attorney fee award, and requests attorney fees on appeal. We decline to reach the conditional contempt order but otherwise affirm and award attorney fees to respondent on appeal in the amount of $1,000.
DECISION I.
We will affirm a district court's determination of net income for the purpose of calculating child support if it has a reasonable basis in fact. Strauch v. Strauch, 401 N.W.2d 444, 448 (Minn.App. 1987). Under Minn. Stat. § 518.551, subd. 5b(d) (Supp. 1999), the court may calculate child support based on imputed income if the court finds that a parent is voluntarily underemployed. A parent is not considered voluntarily underemployed provided the parent can show that the condition
(1) is temporary and will ultimately lead to an increase in income; or (2) represents a bona fide career change that outweighs the adverse effect of that parent's diminished income on the child.
Id.
Appellant contends the district court abused its discretion by finding that he self-limited his income by failing to adequately pursue replacement employment following his involuntary termination. We disagree. Appellant conceded that he pursued few of the numerous advertised job openings in his field and that his telephone inquiries in early 1999 were made for purposes of qualifying for reemployment compensation benefits. The district court's finding that appellant failed to seek replacement employment was not clearly erroneous.
Appellant also claims the court erred by determining he had not engaged in a bona fide effort to establish a new business and therefore did not fall within the statutory exception under section 518.551, subdivision 5(b)(d). We disagree. When an individual seeks to modify spousal maintenance on the basis of a career change, the court evaluates the party's motives to determine whether the change was made in good or bad faith. Giesner v. Giesner, 319 N.W.2d 718, 720 (Minn. 1982); In re Marriage of Richards, 472 N.W.2d 162, 164 (Minn.App. 1991). The obligor has the burden of proving he acted in good faith. Schneider v. Schneider, 473 N.W.2d 329, 332 (Minn.App. 1991). The obligor has no defense if he has the capacity to comply with the court-ordered obligation, but has not made reasonable efforts on his own to do so. Giesner, 319 N.W.2d at 719-20.
Here, the district court's determination that appellant had made only half-hearted attempts to establish his new business is supported by the court's findings that (1) in early 1999, appellant took a two-week vacation and spent several thousand dollars at casinos; (2) appellant is presently operating his business out of a one-car garage at his home; and (3) appellant's gross business deposits from April through July 1999 totaled only $4,001. We conclude the district court's finding that appellant failed to prove he was engaged in a good-faith, bona fide career change has support in the record and was not clearly erroneous.
Moreover, as the district court noted in its memorandum, appellant could have avoided his present financial difficulties by honoring respondent's lien on his pension plan, rather than withdrawing the funds and spending them without her knowledge and consent. Even where an underemployed obligor makes a diligent job search, it may be appropriate to take into account the obligor's pretermination financial assets in weighing a motion for modification of support. Darcy v. Darcy, 455 N.W.2d 518, 522 (Minn.App. 1990). Strong public policy reasons exist for requiring that parents support their children and an obligor has a duty to consider future child support obligations when constructing a budget. Id. Appellant cannot show that his inability to meet his current obligations does not involve bad faith when he would have been able to pay the support had he preserved his pension assets as ordered. See Giesner, 319 N.W.2d at 719-20.
Appellant's argument that respondent waived her right to enforce the lien is without merit. Respondent had no reason to assert her lien interest until appellant failed to make his support and maintenance payments. The 1994 dissolution decree was subject to a ten-year statute of limitations and remained enforceable. Minn. Stat. § 541.04 (1998); see also Nazarenko v. Mader, 362 N.W.2d 1, 2 (Minn.App. 1985) (noting application of ten-year statute of limitation to action for enforcement of provisions in a divorce decree).
Once the district court found that appellant's inability to pay his child support and maintenance obligations was due to his own bad-faith conduct, the court refused to consider appellant's claim of changed circumstances and instead imputed income to him based on his earning capacity. Earning capacity is an appropriate measure of income if an obligor has unjustifiably self-limited his or her earnings. Beede v. Law, 400 N.W.2d 831, 835-36 (Minn.App. 1987); s ee also Resch v. Resch, 381 N.W.2d 460, 462 (Minn.App. 1986) (holding district court may award child support commensurate with the wage a parent "could earn if he sought employment in an occupation for which he is trained and has the present ability to perform").
Appellant contends the court had no basis for imputing income to him of $4,000 per month. We disagree. The relevant statute defines "imputed income" as
the estimated earning ability of a parent based on the parent's prior earnings history, education, and job skills, and on availability of jobs within the community for an individual with the parent's qualifications.
Minn. Stat. § 518.551, subd. 5b(d). The record reflects that appellant was earning $46,000 at the time of his discharge. Respondent submitted classified employment ads showing numerous open positions for machinists or tool-and-die makers with starting pay as much as $22 per hour. The district court did not abuse its discretion in imputing a $48,000 yearly income to appellant.
II.
Modification of child support or maintenance is within the district court's discretion and will not be reversed absent an abuse of that discretion. Hennessy v. Stelton, 302 Minn. 550, 550, 224 N.W.2d 926, 927 (1974) (child support); Dougherty v. Dougherty, 443 N.W.2d 193, 194 (Minn.App. 1989) (maintenance). We will reverse only if the district court's order reflects a "clearly erroneous conclusion that is against logic and the facts on the record." Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984).
We examine the disposition of a motion for modification of child support or spousal maintenance in light of the controlling statutory factors set forth in Minn. Stat. § 518.64 (1998 Supp. 1999). Subdivision 2(a) allows modification if the moving party demonstrates a substantial change in income or need as well as unfairness resulting from that change. Minn. Stat. § 518.64, subd. 2(a). The rationale behind permitting modification is that a former spouse and children should share in the financial burden as if the parties' marriage were still intact if the burden was not the product of a party's bad faith. Giesner, 319 N.W.2d at 720. But a modification is not proper if the obligor has not made a reasonable effort to conform to an order within his or her inherent capacities. Id. at 719-20.
Here, because appellant improperly spent his pension assets and self-limited his income, he failed to prove that he suffered an involuntary change in circumstances that was not a product of his own bad-faith conduct. We conclude the district court properly denied appellant's motion to modify his child support and maintenance obligations.
III.
Appellant challenges the district court's order finding him in civil constructive contempt for failure to pay support and maintenance or to honor the lien on his pension plan. The contempt order, which contains conditions by which appellant may purge the contempt, was stayed by the district court pending the disposition of this appeal. A conditional contempt order that provides a method by which the contemnor may purge the contempt is not a final appealable order. Johnson v. Johnson, 439 N.W.2d 430, 431 (Minn.App. 1989). We therefore decline to review it.
IV.
Both parties challenge the district court's award of part of respondent's attorney fees. An award of attorney fees under Minn. Stat. § 518.14 (1998) "rests almost entirely within the discretion of the trial court and will not be disturbed absent a clear abuse of discretion." Jensen v. Jensen, 409 N.W.2d 60, 63 (Minn.App. 1987). The district court may award fees based on the need of the requesting party, if the other party has the ability to pay, or against a party "who unreasonably contributes to the length or expense of the proceeding." Minn. Stat. § 518.14, subd. 1.
The district court awarded respondent $1,000 of her requested $5,208 in attorney fees after finding (1) respondent had incurred the fees in a good-faith effort to defend and enforce the terms of the decree; (2) appellant had greater resources than respondent; and (3) appellant's conduct contributed to the expense of the proceedings. Appellant first argues that the fee award was an abuse of discretion because it was based on an improper imputation of income. Because we affirm the imputation of income, we disagree.
Appellant also contends that he did not engage in misconduct sufficient to support an attorney-fee award. Again, we disagree. The record supports the district court's findings that a motion hearing was continued due to appellant's belated retention of counsel and that appellant failed to comply with discovery requests. The district court did not abuse its discretion in awarding attorney fees to respondent.
Respondent argues that the court erred by failing to award all of her requested attorney fees pursuant to the provisions of Minn. Stat. § 518.14, subd. 2 (1998). But this case does not meet the requirements of subdivision 2 because the arrearages were never reduced to a docketed judgment. See Minn. Stat. § 518.14, subd. 2(a).
Finally, based on the parties' disparate income and appellant's failure to prevail on appeal, we grant respondent's motion for attorney fees on appeal in the amount of $1,000. See, e.g., Sefkow v. Sefkow, 427 N.W.2d 203, 217 (Minn. 1988) (awarding limited attorney fees to respondent based on disparity of income and appellant's limited success on appeal).
V.
In his brief to this court, appellant challenged the district court's order setting the escrow in an amount that did not include the decrease in his remaining future child support obligations. At oral argument, counsel for both parties agreed that they had reached a mutually acceptable resolution of this issue and that this court need not address it. Therefore, with the parties' consent, we deem the issue of the escrow account withdrawn.