O'DONNELL v. O'DONNELL

• Decision Date: 27 April 2004
• Docket Number: No. A03-897.,A03-897.
• Citation: 678 N.W.2d 471
• Parties: In re the Marriage of Patrick M. O'DONNELL, petitioner, Respondent, v. Mary Lou Z. O'DONNELL, co-petitioner, Appellant.
• Court: Minnesota Court of Appeals

678 N.W.2d 471

In re the Marriage of Patrick M. O'DONNELL, petitioner, Respondent, v. Mary Lou Z. O'DONNELL, co-petitioner, Appellant.

No. A03-897.

Court of Appeals of Minnesota.

April 27, 2004.

Kay R. Snyder, Jeddeloh & Snyder, P.A., St. Cloud, MN, for respondent.

Marna L. Anderson, Hicken, Scott & Howard, P.A., Anoka, MN, for appellant.

Considered and decided by SHUMAKER, Presiding Judge; KALITOWSKI, Judge; and MINGE, Judge.

OPINION

MINGE, Judge.

Appellant, support obligor, challenges the district court's modification order increasing child support. Appellant claims that the parties had stipulated to child support that the original district court approved, that college tuition payments for an emancipated child and mortgage payments incurred to finance a property division are not recognizable expenses in setting child support levels, and that the other claimed changes in circumstance were foreseeable. Because we determine the district court erred in increasing child support, we reverse.

FACTS

Appellant Mary Lou Z. O'Donnell and respondent Patrick M. O'Donnell dissolved their 20-year marriage in May 2002. Appellant is a ministry support coordinator, respondent an attorney. The parties entered into a marital termination agreement whereby respondent father was granted sole physical custody of the couple's two minor children. The parties waived their rights to maintenance and stipulated to a downward deviation from the child support guidelines. The child support guidelines would have required appellant mother to pay $546.60 a month, but pursuant to the agreement, she was ordered to pay respondent $250 per month for 30 months, and thereafter $350 per month.

Five months after entry of the stipulated judgment, respondent filed a motion seeking an increase in child support. Respondent claimed that his overall expenses had increased due to, in part, his undertaking to pay college expenses for the parties' emancipated daughter, an increase in his mortgage payment due to the property settlement, a purchase of a new vehicle, which he claimed was necessary to transport the children, an increase in the cost of health insurance, and an increase in the children's school activity fees. Respondent argued that because appellant was now living with another individual with whom appellant shares expenses, appellant's expenses had decreased. But appellant claimed that she had purchased a home and made other financial commitments such that her expenses still exceeded her income.

Following a December 2002 hearing, the district court granted respondent's motion and ordered an increase in appellant's child support payments from $250 to $546.60 per month. Appellant now appeals the district court's order to increase her monthly child support payments.

ISSUES

1. Did the district court abuse its discretion by including the cost of college tuition for an emancipated child in respondent's reasonable expenses?

2. Did the district court abuse its discretion by including an increase in mortgage payments resulting from the parties' property settlement in respondent's reasonable expenses?

3. Did respondent meet his burden of establishing increased expenses justifying modification of stipulated child support?

4. Is child support set forth in a stipulated agreement subject to subsequent modification if it is 20% and $50 lower than that called for in the child support guidelines?

ANALYSIS

On appeal from a district court's order modifying child support, an appellate court reviews the district court's decision for an abuse of discretion. Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn.1984). An abuse of discretion occurs when the district court resolves the matter in a manner that is "against logic and the facts on [the] record." Id. An appellate court will generally not disturb a district court's determination of child support if it has a reasonable and acceptable basis in fact. Kirby v. Kirby, 348 N.W.2d 392, 394 (Minn.App. 1984). The district court is required to make specific findings on the statutory factors in Minn.Stat. § 518.64, subd. 2 (2002). Allan v. Allan, 509 N.W.2d 593, 596 (Minn.App.1993).

I.

The first issue is whether the district court erred in adding $417 in college tuition payments for an emancipated child to respondent's monthly expenses. Appellant argues that this is a voluntarily assumed expense for respondent and an inappropriate basis for modification.

Minnesota caselaw is clear on the issue of college tuition for emancipated children. In Tibbetts v. Tibbetts, we considered whether $1,800 a year for an emancipated child's college tuition could be added to the appellant's expenses when considering child support modification, and we held that such an "expense is an inappropriate basis for a modification in child support because only the needs of the minor child are relevant." 398 N.W.2d 16, 19 (Minn. App.1986).

Here, the parties' stipulated agreement does not provide for any expenses of emancipated children. Absent such a provision, the district court should not have considered respondent's college tuition payments for the parties' emancipated child as part of his reasonable expenses on a motion for child support modification.

II.

The next issue is whether, in considering a request for increased child support, the district court erred in adding to respondent's expenses an increase in respondent's mortgage payments caused by his financing obligations under the parties' property settlement. The property settlement awarded title of the home to respondent and gave appellant a $27,528.84 lien on the property to be paid by respondent. Respondent alleged below that his expenses increased due to the "loan cost to provide [appellant] with her requested half of the equity in our home." The district court found, "[respondent's] mortgage expense has increased due to the property settlement. His stated monthly budget is fair and reasonable." Appellant argues the district court may not consider this type of expense as a basis to modify child support.

This court considered a claim of substantial change in circumstances stemming from an increase of expenses resulting from a property settlement in the case of Abuzzahab v. Abuzzahab, 359 N.W.2d 329 (Minn.App.1984). We held that changes directly resulting from a property division in a dissolution proceeding are not the type contemplated by Minn.Stat. § 518.64, subd. 2. Id. at 332. The district court therefore erred by using increased mortgage expenses arising from the property settlement as a change in circumstances.

III.

The third issue is whether the district court erred in finding that respondent's other increased expenses constituted a change in circumstances that warranted a modification of child support as set in the stipulated agreement. The district court found that, while appellant's income had remained the same, she experienced an increase in expenses since the time of the previous order. Nonetheless, the court found that respondent's expenses had increased enough to create a substantial change in circumstances such that the current order for child support was unfair and unreasonable.

Generally, a stipulation fixing the respective rights and obligations of the parties represents their voluntary acquiescence in an equitable settlement, and the district court should "carefully and only reluctantly" alter its terms. See Claybaugh v. Claybaugh, 312 N.W.2d 447, 449 (Minn.1981) (discussing stipulated spousal maintenance). But, the existence of a stipulation does not "bar later consideration of whether a change in circumstances warrants a modification." Hecker v. Hecker, 568 N.W.2d 705, 709 (Minn.1997). Where child support is concerned, Minnesota caselaw indicates that "[a]lthough a stipulation is one factor to be considered in modification motions, child support `relates to nonbargainable interests of children and is less subject to restraint by stipulation than are other dissolution matters.'" Martin v. Martin, 401 N.W.2d 107, 110 (Minn. App.1987) (quoting Maxson v. Derence, 384 N.W.2d 583, 585 (Minn.App.1986)).

Minnesota statutes provide that a district court may modify a child support order if two conditions are met: (1) the moving party shows a substantial change in circumstances; and (2) that the change makes the existing award unreasonable and unfair. Stephens v. Stephens, 407 N.W.2d 468, 470-71 (Minn.App.1987). See Minn.Stat. § 518.64, subd. 2(a) (2002). A change of circumstances includes a substantial increase or decrease in a party's earnings or expenses. Id.

Here, the district court found that respondent's expenses increased by $1,631, from $4,100 at the time of the decree in May to $5,731 five months later in October. At least $600 of respondent's increased expenses was based on college tuition and mortgage payments that, as we held above, are an improper basis for modification. The district court identified other expenses based on the needs of the two younger children that also supported a change. Although not discussed in any detail by the district court, the respondent's affidavit gives some particulars:

I

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