Dodge v. Dodge, WD 74876.

• Decision Date: 30 April 2013
• Docket Number: No. WD 74876.,WD 74876.
• Citation: 398 S.W.3d 49
• Parties: Daniel Lloyd DODGE, Respondent, v. Sheila K. DODGE, Appellant.
• Court: Missouri Court of Appeals

398 S.W.3d 49

Daniel Lloyd DODGE, Respondent,

v.Sheila K. DODGE, Appellant.

No. WD 74876.

Missouri Court of Appeals,

Western District.

April 2, 2013.

As Modified April 30, 2013.

Michael J. Englert, Independence, MO, for respondent.

Ryan C. Evans, for appellant.

Before Division Three: CYNTHIA L. MARTIN, Presiding Judge, JOSEPH M. ELLIS, Judge and GARY D. WITT, Judge.

JOSEPH M. ELLIS, Judge.

Appellant Sheila K. Dodge (“Mother”) appeals from a dissolution decree and judgment entered by the Circuit Court of Jackson County dissolving her marriage to Daniel L. Dodge (“Father”) and awarding joint legal custody of their three minor children. Mother contends that the circuit court erred in calculating Father's gross income and in awarding the dependency tax exemptions to alternate yearly between her and Father without rebutting the presumed child support amount as unjust or inappropriate. For the following reasons, the judgment is reversed and remanded.

In 1996, Mother and Father were married. Three children were born of the marriage. Mother and Father separated in 2001.

On June 11, 2010, Father filed a petition for dissolution of marriage that requested the circuit court to dissolve the marriage, divide the marital property equitably, and award custody of the children. Mother filed her answer and counter petition for dissolution of marriage on September 1, 2010. In her counter petition, mother requested the court award her both the federal and state tax exemptions for all three minor children.

On December 20, 2011, a trial was held regarding the parties' petitions for dissolution at which both Father and Mother testified. Father testified that he had earned $40,000.00 in 2008, $70,000.00 in 2010, and was “on track” to earn $62,000.00 in 2011. On cross-examination, Father's 2010 tax return was introduced into evidence. Father testified that his 2010 tax return indicated that he made $67,778.00 in the form of wages and listed additional income of $2,850.00 in what he testified “could be considered a bonus, but is considered a dividend ... in the company.” ¹ Further evidence was presented that Father received an income distribution for the amount of $39,749.00 from his company in 2009. One of Father's paystubs was also introduced on cross-examination. It showed that as of August 31, 2011, Father had made $41,241.00 in gross wages. When questioned as to whether he would receive another “distribution of income” from his company in 2011, Father stated “Yeah,” but went on to explain that the business was having “a really rough year.”

Father and Mother also introduced into evidence their respective income and expense statements, parenting plans, and Form 14s. Father introduced two Form 14s, one of which calculated the presumed child support award (“PCSA”) at $908.00 per month.

On January 24, 2012, the circuit court entered its judgment dissolving the marriage and awarding joint legal custody of the three minor children. The circuit court adopted the Form 14 prepared by Father that calculated the PCSA at $908.00. The circuit court did not rebut the PCSA as unjust or inappropriate. The circuit court also made the following orders with respect to the tax dependency exemptions for the three minor children:

Father and Mother shall alternate [tax dependency] exemptions, the Father shall have one exemption in Odd numbered years and [M]other shall have 2 exemptions in Odd numbered years. The Father shall have 2 exemptions in Even numbered years and the Mother shall have 1 exemption in Even numbered years. That if the Father is more than 30 day's [sic] in arrears on child support he shall lose his exemption.

Mother now raises two points of error on appeal.

In her first point, Mother contends that the circuit court erred in ordering Father to pay $908.00 in child support per month because the circuit court erroneously calculated Father's gross income. More specifically, Mother avers that the circuit court should have included Father's annual “bonus/dividend” in the calculation of his gross income or, alternatively, should have used Father's 2010 tax return to determine his gross income.

“In determining an award of child support in any proceeding, § 452.340.8 and Rule 88.01 require the trial court to follow the two-step procedure set forth in Woolridge v. Woolridge, 915 S.W.2d 372, 379 (Mo.App. W.D.1996).” Jarvis v. Jarvis, 131 S.W.3d 894, 896–97 (Mo.App. W.D.2004). “First, the court must determine and find for the record the PCSA, in accordance with Form 14.” Scobee ex rel. Roberts v. Scobee, 360 S.W.3d 336, 342 (Mo.App. W.D.2012) (internal quotation omitted). “Second, the court, after considering all relevant factors, must determine whether to rebut the PCSA as being unjust or inappropriate.” Id. (internal quotation omitted).

“Our review then of an award of child support is essentially one of the trial court's application of the two-step Woolridge procedure, applying the standard enunciated in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976).” Id. (internal quotation omitted). “Hence, in reviewing an award of child support, we review the award, in light of the trial court's application of the Woolridge procedure, to determine whether it is supported by substantial evidence, is not against the weight of the evidence, and does not erroneously declare or apply the law.” Hart v. Hart, 210 S.W.3d 480, 489 (Mo.App. W.D.2007) (internal quotation omitted). “After reviewing and determining that the trial court's application of the Woolridge procedure passes the Murphy v. Carron standard, we then review for an abuse of discretion with respect to the trial court's rebuttal review of its PCSA calculation.” Peniston v. Peniston, 161 S.W.3d 428, 433 (Mo.App. W.D.2005) (internal quotation omitted). Accordingly, “we will interfere with the trial court's award only if the trial court abused its discretion by ordering an amount that is against the logic of the circumstances or arbitrary or unreasonable.” Scobee, 360 S.W.3d at 342 (internal quotation omitted).

Mother asserts that Father's gross income as listed on the adopted Form 14 was erroneous. Thus, Mother is contesting the Form 14 calculation of the PCSA. When “determining whether the trial court correctly calculated the [PCSA], this Court reviews the calculation to ensure that not only is it done accurately from a mathematical standpoint, but that the various items and their amounts were properly included in the calculation and supported by substantial evidence.” Bond v. Bond, 77 S.W.3d 7, 11 (Mo.App. E.D.2002). “We will not substitute our judgment for that of the trial court absent a manifest abuse of discretion, and we will not disturb an award of child support unless the evidence is ‘palpably insufficient’ to support it.” Pearcy v. Pearcy, 193 S.W.3d 844, 846 (Mo.App. S.D.2006) (internal quotation omitted). Having reviewed the record, we find that there is sufficient evidence to support the calculation of Father's gross monthly income at $3,437.00.

The Directions, Comments for Use and Examples for Completion of Form 14 provides that

“Gross income” includes, but is not limited to, salaries, wages, commissions, dividends, severance pay, pensions, interest, trust income, annuities, partnership distributions, social security benefits, retirement benefits, workers' compensation benefits, unemployment compensation benefits, disability insurance benefits, veterans' disability benefits, and military allowances for subsistence and quarters.

Overtime compensation, bonuses, earnings from secondary employment, recurring capital gains, prizes, retained earnings and significant employment-related benefits may be included, in whole or in part, in “gross income” in appropriate circumstances.

Mo. R. Civ. P. Form 14, Line 1, Directions. The Form 14 directions further instruct that “one-twelfth of the parent's gross yearly income” should be entered on Line 1 as the parent's gross income. Id.

“It is well settled that courts should consider past, present, and anticipated earning capacity in determining child support amounts.” Pearcy, 193 S.W.3d at 847. “Courts are free to consider both past and present earnings to determine an average that is consistent with historical earnings and representative of future earnings.” Id. (internal quotation omitted). A parent's past earnings are indicative of that parent's present earning capacity. Noland–Vance v. Vance, 321 S.W.3d 398, 421 (Mo.App. S.D.2010).

The Form 14 adopted by the circuit court calculated Father's gross income at $3,437.00, resulting in a gross yearly income calculation of $41,244.00 ($3,437.00 x 12). The record reflects the following with respect to Father's income. Father testified that he earned $40,000.00 in 2008, $70,000.00 in 2010, and was “on track” to earn $62,000.00 in 2011. Father further testified that his 2010 tax return indicates that he earned $67,778.00 in the form of wages and listed additional income of $2,850.00 in the form of a dividend/bonus from his company. Further evidence was presented that Father received an income distribution for the amount of $39,749.00 from his company in 2009. A paystub of Father's also introduced at trial showed that, as of August 31, 2011, Father had earned $41,241.00 in gross wages.

Thus, viewed in the light most favorable to the circuit court's judgment, the evidence established that, from 2008 to 2011, Father's gross yearly income ranged from $39,749.00 to $70,000.00. The circuit court was free to consider this range of evidence presented regarding Father's past, present, and future earnings in determining his gross income for Form 14 purposes. The calculation of Father's gross yearly income of $41,244.00 falls within the range of evidence presented regarding Father's yearly income; albeit such calculation is on the lower end of that range.²

Nevertheless, our review of the record and the adopted Form 14 suggests a possible mathematical error occurred in the calculation of Father's...