Baraby v. Baraby

• Decision Date: 17 December 1998
• Citation: 681 N.Y.S.2d 826,250 A.D.2d 201
• Parties: , 1998 N.Y. Slip Op. 11,250 Carolyn BARABY, Appellant-Respondent, v. Bryan BARABY, Respondent-Appellant.
• Court: New York Supreme Court — Appellate Division

Page 826

681 N.Y.S.2d 826

250 A.D.2d 201, 1998 N.Y. Slip Op. 11,250

Carolyn BARABY, Appellant-Respondent, v. Bryan BARABY, Respondent-Appellant.

Supreme Court, Appellate Division,

Third Department.

Dec. 17, 1998.

Bartlett, Pontiff, Stewart & Rhodes (Mark E. Cerasano, of counsel), for appellant-respondent.

Asadourian & Johnston (Ara Asadourian, of counsel), Plattsburgh, for respondent-appellant.

Before CARDONA, P.J., MERCURE, WHITE, YESAWICH and PETERS, JJ.

CARDONA, P.J.

Cross appeals from an order of the Supreme Court (Dawson, J.), entered January 23, 1998 in Essex County, which fixed the parties' child support obligations.

The parties married in 1978 and have two children, Tanner (born in 1982) and Troy (born in 1986). Plaintiff commenced an action for divorce in February 1995. In November 1995, the parties separated and have shared physical custody of the children on an equal basis by alternating weeks. Several child support orders have been issued setting and adjusting defendant's child support obligation. In July 1997, the parties executed a separation agreement which continued their custody arrangement and resolved all other ancillary issues except child support.

That issue was tried before Supreme Court which applied the Child Support Standards Act (Domestic Relations Law § 240[1-b] ) (hereinafter CSSA) and calculated the parties' combined parental income according to the three-step statutory formula (see, Domestic Relations Law § 240[1-b][c][1]-[3] ). It then applied the proportional offset method ¹ initially embraced by our court in Matter of Holmes v. Holmes, 184 A.D.2d 185, 592 N.Y.S.2d 72, lv. denied 90 N.Y.2d 802, 660 N.Y.S.2d 712, 683 N.E.2d 335, and found unworkable in Matter of Simmons v. Hyland (235 A.D.2d 67, 70, 663 N.Y.S.2d 434) (see, Bast v. Rossoff, 91 N.Y.2d 723, 732, 675 N.Y.S.2d 19, 697 N.E.2d 1009). In doing so, the court reduced each party's monthly child support obligation by half and "netted out" those amounts to arrive at a support amount to be paid by defendant to plaintiff.

As a result, defendant was directed to pay plaintiff $365 per month for 1995, instead of $1,325, and $453 per month for 1996 and 1997, instead of $1,290. Supreme Court also gave defendant credit against his child support obligation for voluntary payments of $680 per month for the months of November 1995 through and including July 1996. Additionally, the court determined that defendant overpaid plaintiff for the months of November and December 1995 as well as January to July 1996, in the amounts of $630 and $1,589, respectively. The court permitted defendant to recoup these sums from future child support payments in an amount not to exceed $50 per month. Finally, the court directed defendant to pay plaintiff 77% of her childcare expenses. Both parties appeal.

Defendant argues that the only logical way to apply the CSSA to cases of equal shared custody is to equally divide between each parent the combined child support obligation arrived at by application of the three-step formula. We disagree. It is now settled that "[s]hared custody arrangements do not alter the scope and methodology of the CSSA" (Bast v. Rossoff, supra, at 732, 675 N.Y.S.2d 19, 697 N.E.2d 1009). The Court of Appeals has explicitly rejected use of the proportional offset method in shared custody cases (see, id., at 732, 675 N.Y.S.2d 19, 697 N.E.2d 1009). The three-step statutory formula of the CSSA for determining the basic child support obligation must be applied in all shared custody cases (see, id., at 728-729, 675 N.Y.S.2d 19, 697 N.E.2d 1009) and the noncustodial parent directed to pay a pro rata share of that obligation unless the court finds that amount to be "unjust or inappropriate" based upon a consideration of the "paragraph (f)" factors (Domestic Relations Law § 240[1-b][f], [g]; see, Bast v. Rossoff, supra, at 729, 675 N.Y.S.2d 19, 697 N.E.2d 1009). We recognize that Bast did not specifically address how to apply the CSSA in cases of equal shared custody.

Nevertheless, we interpret Bast as requiring application of the CSSA to such situations to assure that children will realize the maximum benefit of their parents' resources and continue, as near as possible, their preseparation standard of living in each household. In order to effectuate this goal, where, as here, the parents' custodial arrangement splits the children's physical custody so that neither can be said to have physical custody of the children for a majority of the time, the parent having the greater pro rata share of the child support obligation, determined after application of the three-step statutory formula of the CSSA, should be identified as the "noncustodial" parent for the purpose of support regardless of the labels employed by the parties (cf., Bast v. Rossoff, supra, at 728, 675 N.Y.S.2d 19, 697 N.E.2d 1009). That parent must be directed to pay his or her pro rata share of the child support obligation to the other parent unless "the statutory formula yields a result that is unjust or inappropriate" (Bast v. Rossoff, supra, at 729, 675 N.Y.S.2d 19, 697 N.E.2d 1009). In that event, "the trial court can resort to the 'paragraph (f)' factors and order payment of an amount that is just and appropriate" (Bast v. Rossoff, supra, at 729, 675 N.Y.S.2d 19, 697 N.E.2d 1009). Since Supreme Court applied the proportional offset methodology, the matter must be remitted for a recalculation of defendant's child support obligation. Prior to remittal, we address other pertinent issues raised by the parties.

First, as both parties concede, Supreme Court incorrectly computed the FICA deductions for 1995, 1996 and 1997 by applying the 7.65% rate to all of defendant's income instead of applying the old-age survivors and disability insurance (hereinafter OASDI) rate of 6.2% to defendant's wages within the OASDI wage base, which was $61,200 for 1995, $62,700 for 1996 and $65,400 for 1997 (see, Internal Revenue Code [26 U.S.C. § 3101(a) ]; 59 Fed.Reg. 54464, 60 Fed.Reg. 54751, 61 Fed.Reg. 55346).

Next, we find that Supreme Court erred in subtracting $9,000 of defendant's claimed $16,434 in business losses from his 1996 gross income of $76,065. Of the $9,000 claimed, $8,688 was allowed for depreciation in Baraby Development and the parties' Keesville apartment house. There was evidence that business expenses related to these jointly owned enterprises were partly paid by the parties' home equity loan which will be repaid from the proceeds of the sale of their jointly held real estate. Because defendant failed to prove that the depreciation was an actual out-of-pocket expense incurred by him alone (see, Matter of Barber v. Cahill, 240 A.D.2d 887, 888, 658 N.Y.S.2d 738; Matter of Westchester County Dept. of Social Servs. [Rosa B.] v. Jose C., 204 A.D.2d 795, 798, 611 N.Y.S.2d 704; see also, Blaise v. Blaise, 241 A.D.2d 680, 682, 659 N.Y.S.2d 926) and failed to adequately substantiate the remaining business losses, the $9,000 deduction...