Opinion
No. 1-882 / 00-1342.
Filed March 27, 2002.
Appeal from the Iowa District Court for Polk County, ELIZA J. OVROM, Judge.
The respondent appeals from the district court's ruling denying his request to modify his child support obligation. REVERSED AND REMANDED.
Dennis Bjorklund, Coralville, for appellant.
Susan Ekstrom of Ekstrom Burkey, Des Moines, for appellee Marlene Fisher.
Christina Hansen, Assistant Attorney General, for appellee Child Support Recovery Unit.
Considered by VOGEL, P.J., and MILLER and EISENHAUER, JJ.
Christopher Young appeals from the district court's ruling denying his request to modify his child support obligation. He contends (1) the district court erred in failing to consider factors establishing a substantial change in circumstances, (2) a modification of child support was consistent with the current child support guidelines, and (3) he is entitled to reasonable appellate attorney fees. We reverse and remand.
I. BACKGROUND FACTS AND PROCEEDINGS.
Christopher Young and Marlene Young, now known as Marlene Fisher, were married in 1981. They had a child, Jessica, born September 4, 1983. The marriage of Christopher and Marlene was dissolved in 1985. Marlene was awarded physical care of Jessica. Christopher was ordered to pay child support in the amount of $25 per week. This amount was modified in 1989 to $55 per week.
Christopher's child support obligation was adjusted in 1997 to $81 per week. According to the child support guidelines worksheets prepared by the Child Support Recovery Unit (CSRU), at the time of the 1997 modification Christopher's net monthly income was $1562.13, Marlene's gross monthly income was $1933, and her net monthly income was $1713. These are the incomes that were used in calculating Christopher's child support obligation to be $81 per week.
Although Christopher's 1995, 1996, and 1997 income tax returns had reported total income of $7751, $10,166, and $6548 respectively, he did not provide income information, so the CSRU used estimated state median income. See Iowa Code § 252B.7A(1)(d) (1997).
In 1999, Christopher requested review and adjustment of his child support obligation through Iowa Code chapter 252H (1999). The child support guidelines worksheet prepared by the CSRU on January 26, 2000 found that Christopher's gross monthly income was $846, and his net monthly income was $646. It found Marlene's gross monthly income was $3135, and her net monthly income was $2240.70. Pursuant to the guidelines, the CSRU calculated that the amount of child support Christopher should be paying was $24 per week, a variance of 243.65% from the amount he is paying.
Marlene requested a court hearing pursuant to section 252H.8(1). Following a hearing, the district court determined there was no change in circumstances since 1997 and denied Christopher's "request to modify." Christopher appeals.
II. SCOPE OF REVIEW.
The parties agree that our review is de novo. Iowa R. App. P. 6.4. We give weight to the trial court's factual findings but are not bound by them. In re Marriage of Bolick, 539 N.W.2d 357, 359 (Iowa 1995).
Formerly Iowa Rule of Appellate Procedure 4.
III. MODIFICATION OF CHILD SUPPORT.
The district court found Marlene's income to be substantially the same as it was at the time of the 1997 adjustment. It further found his income to be substantially the same, if not slightly higher, because of the sale of a vehicle in 1999. It concluded Christopher had not shown a substantial change of circumstances that would warrant a modification of Christopher's child support obligation. Christopher contends on appeal that the court erred in failing to consider factors establishing a substantial change in circumstances, and a modification was consistent with the current child support guidelines. He asserts that the court disregarded sections 252H.2(11), 252H.8(10), and 598.21(4) and (9). The State argues that the district court correctly found no substantial change of circumstances, and application of the child support guidelines is not required when there is no substantial change of circumstances in a modification action.
Pursuant to section 252H.8(1), either parent may request a court hearing in a review and adjustment action commenced under chapter 252H. The CSRU certifies the matter to the district court in the county in which the order subject to adjustment or modification is filed, and the certification includes copies of financial statements and supporting documentation provided by the parties and copies of computation worksheets prepared by CSRU to determine the amount of support calculated using the mandatory child support guidelines established under section 598.21(4). Iowa Code § 252H.8(4)(f), (g). The district court is to review the matter as an original hearing. Iowa Code § 252H.8(7). The district court is required to establish the amount of child support pursuant to section 598.21(4) (child support guidelines). Iowa Code § 252H.8(10). Application of the child support guidelines requires a determination of the parties' net monthly incomes. In re Marriage of Hilmo, 623 N.W.2d 809, 811 (Iowa 2001). Net income is gross income less certain allowable deductions. Id.
The trial court failed to determine the parties' net incomes and then determine the amount Christopher would be obligated to pay under the child support guidelines. The undisputed evidence before the district court shows that Marlene is an assistant professor of sociology at Viterbo College with a salary of $37,617 per year, or $3135 per month. The CSRU calculated her net monthly income to be $2240.70, a figure which is not disputed on appeal. Her gross income has thus increased sixty-two percent, and her net income has increased thirty-one percent, since the 1997 modification. The trial court's finding that her income is substantially the same as it was at the time of the 1997 modification is not supported by substantial evidence and is in fact contrary to the undisputed evidence.
In calculating a child support obligation a court must first determine parents' current monthly net incomes from the most reliable evidence admitted. In re Marriage of Knickerbocker, 601 N.W.2d 48, 51 (Iowa 1999); In re Marriage of Krone, 530 N.W.2d 468, 471 (Iowa Ct.App. 1995). Generally, completed federal and/or state income tax returns are the best evidence of income and tax liability. In re Marriage of Will, 602 N.W.2d 202, 204 (Iowa Ct.App. 1999).
The evidence presented to the trial court included Christopher's 1995, 1996, and 1997 federal and state income tax returns. The federal returns show that he had total income of $7751, $10,166, and $6548 for those three years respectively. Christopher testified that he is self-employed as an upholsterer. His current financial statement shows gross annual income of $10,156, which he testified included rental income from one-half of a duplex he owns and lives in. This $10,156 is quite apparently the figure the CSRU used in calculating his gross monthly income at $846 and his net monthly income at $646.
His income tax returns show his rental income exceeded related expenses for the years 1995, 1996, and 1997 by an average of only $42 per year.
The trial court made no finding that Christopher lacked credibility, that his income tax returns and his financial statement do not accurately reflect his income, or that better or more reliable evidence of his income has been presented. On our de novo review we conclude that the most reliable evidence presented shows Christopher's net income to be $646 per month.
The trial court found that Christopher's income was substantially the same as it had been at the time of the 1997 modification. A comparison of his testimony and his current financial statement to the previously mentioned income tax returns would seem to verify that his current income is not substantially different than his actual income at the time of the 1997 adjustment. However, that adjustment based his child support obligation not on his actual income but on a hypothetical income, the estimated state median income, which was then a net monthly income of $1562.13. We conclude that any determination of whether his income has substantially changed since 1997 requires comparison of his current income not to his actual 1997 income but rather to the hypothetical income that was used to determine his child support obligation in 1997. His current net income of $646 per month is not substantially the same as his 1997 hypothetical net income.
This case involves a review and adjustment proceeding pursuant to section 252H.12. We note, however, that if it were a modification action commenced pursuant to section 598.21(8), then under section 598.21(9) a substantial change in circumstances exists, because the currently existing order for $81 per week varies by ten percent or more from the amount due pursuant to the current child support guidelines.
On our de novo review, based on the best evidence available in the record, we find Marlene's net monthly income is $2240.70 and Christopher's net monthly income is $646. We conclude Christopher's child support obligation should be $24 per week, reverse the trial court's order that declined to adjust the support obligation to that amount, and remand for entry of an order to that effect.
Christopher requests that the adjustment to his child support obligation be made retroactive to the filing of the petition for administrative adjustment. Section 252H.10 provides, in relevant part, that any administrative or court order resulting from an action initiated under chapter 252H may be made retroactive only to the date both parties were served with the notice required under section 252H.15. The evidence shows that following the 1997 adjustment Marlene's gross income had increased to $35,800 per year by the beginning of the 1998-1999 school year, an increase in gross income of more than fifty percent. We conclude the adjustment ordered herein should be retroactive to the earliest date permitted by section 252H.10 and the evidence.
The record shows that Christopher was served with the required notice on November 12, 1999, and Marlene was served November 23, 1999. We conclude the adjustment ordered herein should be made retroactive to Friday, November 26, 1999.
Pursuant to the decree dissolving the parties' marriage Christopher's child support payments are due on Fridays.
IV. APPELLATE ATTORNEY FEES.
Christopher requests appellate attorney fees in the amount of $4000. Marlene resists.
The award of attorney fees on appeal from an action to modify child support is not a matter of right, but rests within the court's discretion and the parties' financial positions. State ex rel. LeClere by LeClere v. Jennings, 523 N.W.2d 306, 309 (Iowa Ct.App. 1994). In determining whether to award appellate attorney fees we consider the needs of the party making the request, the ability of the other party to pay, and whether the party making the request was obligated to defend the trial court's decision on appeal. Id. An award must be for a reasonable amount. Iowa Code § 598.36.
First, we find that Christopher's income is much lower than Marlene's, and he has a need for help with his attorney fees. Second, we find that Marlene has the ability to contribute to Christopher's attorney fees. Finally, we note that the CSRU, not Marlene, filed the appellate brief that defended the trial court's ruling. We order Marlene to contribute $1000 toward Christopher's appellate attorney fees.
V. CONCLUSION.
We reverse the trial court's order that declined to adjust Christopher's child support obligation and remand for entry of an order adjusting his obligation to $24 per week effective with the payment due Friday, November 26, 1999. We award Christopher $1000 appellate attorney fees. Costs on appeal are taxed to Marlene.
REVERSED AND REMANDED.