In re Williams
| Decision Date | 24 November 2021 |
| Docket Number | A172022 |
| Citation | 315 Or.App. 798,504 P.3d 635 |
| Parties | In the MATTER OF the MARRIAGE OF Brianne Marie WILLIAMS, Petitioner-Respondent, and Derek Alexander Williams, Respondent-Appellant. |
| Court | Oregon Court of Appeals |
Michael J. Fearl, Portland, argued the cause for appellant. On the opening brief was Sonia Huntsman Ickes. On the reply brief were Robert William Ickes and Sonia Huntsman Ickes.
Shayna M. Rogers, Salem, argued the cause for respondent. Also on the brief were Tammy M. Dentinger and Garrett Hemann Robertson PC.
Before Armstrong, Presiding Judge, and Tookey, Judge, and Aoyagi, Judge.
Father appeals two supplemental judgments regarding spousal support, child support, and parenting time. In his first assignment of error, he challenges the trial court's determination that no substantial change in economic circumstances has occurred, which was the basis for denying father's request to terminate spousal support and modify child support. For the reasons explained below, we agree with father that the trial court erred in that regard, and we reverse and remand for further proceedings. In his second, third, and fourth assignments of error, father challenges several aspects of the trial court's decision on parenting time; we reject those assignments without written discussion.
"Whether there has been a ‘substantial change in economic circumstances of a party’ sufficient to warrant reconsideration of an award of spousal support under ORS 107.135(3)(a) presents a mixed question of fact and law." Tilson and Tilson , 260 Or. App. 427, 431, 317 P.3d 391 (2013) (quoting ORS 107.135(3)(a) ). "We review the trial court's implicit and explicit findings of historical fact regarding the parties’ economic circumstances to determine whether those findings are supported by any evidence in the record." Id . Whether those facts establish a substantial change under ORS 107.135(3)(a) is a legal question that we review for legal error. Id . at 431-32, 317 P.3d 391.
Father and mother were married from 2013 to 2018. They have one child, G, who was born in 2017.
Under the terms of the dissolution judgment, father must pay mother $1,500 per month in spousal support for three years and $901 per month in child support. The trial court calculated those amounts based on father having monthly income of $8,900 per month—specifically, $6,400 from a business called That's My Gig (TMG) and $2,500 from father's band—and mother having the capacity to earn $2,600 per month.
The business, TMG, was primarily a web-based platform that connected people looking to hire musicians with musicians looking for work. During the marriage, father, mother, and mother's brother owned and operated TMG together, with mother serving as the bookkeeper and father handling the "talent" side of the business. For purposes of the dissolution trial in August 2018, the parties jointly hired an expert to value TMG, and the dissolution court ultimately awarded mother's one-third share of TMG to father (giving him two-thirds ownership), with an equalizing judgment to mother. As noted, at that time, the trial court found from the evidence that father could expect to earn $6,400 per month from TMG, as relevant to setting support amounts.
Because the timing proves relevant, we note that the dissolution trial was held on August 2 and 3, 2018; that the trial court made its findings and decision on the record on August 3, 2018, and directed mother to prepare the judgment; and that the dissolution judgment was entered on the case register on October 29, 2018.
On December 12, 2018—four months after trial and six weeks after entry of judgment—father moved to terminate spousal support and to modify child support. Father claimed a substantial change in his economic circumstances, caused by TMG's demise and a corresponding loss of income. At the modification trial, father testified that mother had been responsible for TMG's finances and that he lacked a "clear financial picture of what was going on with the business" until the fall of 2018, when he obtained the books by legal process and hired an independent bookkeeper. Father learned that subscription declines that began in January 2018 were continuing on a "slope," with TMG losing "a ton of subscribers" in June. Father understood (although mother disagreed) that part of the reason for the subscriber losses related to a new federal law requiring credit card companies to issue "chip" cards to existing cardholders, which led to subscriptions being cancelled when non-chip cards on file for payment were cancelled. Father tried to get lapsed subscribers to resubscribe but had little success. He also had little success getting new subscribers, despite increased advertising in August and September. The independent bookkeeper testified that his review of TMG's books revealed that revenue had started to dwindle "partway through 2018" and that the business "really took a hit" from "August 2018 on."
With a shortage of capital to keep the business going, father decided to shut down TMG around December 2018. He paid off creditors to the extent that he could, and the company was dissolved in January 2019.1
Without income from TMG, father earns only $2,500 per month, according to the trial court's findings at dissolution, or $3,100 per month if one includes new income from guitar lessons, according to evidence at the modification trial. Father is obligated to pay $2,401 to mother for spousal and child support.
The trial court denied father's request to modify support. Framing the question as whether a substantial change in circumstances had occurred that "could not have been anticipated at the time of judgment," the court concluded that there was no change in circumstances because father "should have known" that TMG was losing subscribers, his "failure to recognize or become aware of the loss of subscribers" was "not excusable," and "the loss of [TMG] subscribers which led to the dissolution of [TMG] d[id] not constitute a substantial and unanticipated change in circumstances."
A court may reconsider spousal or child support provisions in a dissolution judgment when there has been a "substantial change in economic circumstances of a party." ORS 107.135(3)(a). The change must be "unanticipated" to permit support modification. Patterson and Patterson , 293 Or. App. 8, 12, 427 P.3d 228 (2018) (); Luty and Luty , 245 Or. App. 393, 399-400, 263 P.3d 1067 (2011) (similar); Nieth and Nieth , 199 Or. App. 330, 334, 111 P.3d 746, adh'd to as clarified on recons. , 200 Or. App. 582, 116 P.3d 234 (2005) (similar). "The burden of establishing a change of circumstances is on the party requesting the change." Thomas and Thomas , 181 Or. App. 128, 131, 45 P.3d 954 (2002).
We first consider when a change in circumstances must occur, which is the initial point of contention between the parties. Father contends that the parties’ economic circumstances must be evaluated relative to the dissolution trial (or the last modification proceeding), whereas mother contends that they must be evaluated relative to the date of entry of the last judgment. The trial court agreed with mother that an alleged change in circumstances is measured against the circumstances that existed on the date that the last judgment was entered.2
There is superficial support for using the date that the judgment was entered. On various occasions, we have referred to the date of judgment when stating the standard for a change in circumstances. For example, in Vandenberg and Vandenberg , 186 Or. App. 592, 597, 64 P.3d 1185 (2003), we said, "An award of spousal support may be modified if there has been a substantial and unanticipated change in circumstances since the entry of judgment." It is unquestionably true that support may be modified based on a postjudgment change in circumstances. It does not follow, however, that support may not be modified based on a change that occurred after trial but before entry of judgment. Vandenberg did not address that issue, because it did not need to, as the alleged change in that case had occurred long after the entry of judgment. See id. at 594, 596, 64 P.3d 1185 (). The same is true of other cases that contain similar statements referring to the judgment date. See, e.g ., Luty , 245 Or. App. at 399-400, 263 P.3d 1067 (); Deboer and Deboer , 212 Or. App. 436, 438, 157 P.3d 1279, rev. den. , 343 Or. 223, 168 P.3d 1154 (2007) (); Nieth , 199 Or. App. at 334, 111 P.3d 746 ().
We agree with father that Sills and Sills , 63 Or. App. 157, 662 P.2d 795, rev. den. , 295 Or. 446, 668 P.2d 382 (1983), is the more apt precedent. In Sills , at the dissolution trial, the husband testified to his income from employment and stated that he expected to lose his job shortly. Id. at 159, 662 P.2d 795. Two weeks after trial, he lost his job. Id. Five weeks after trial, the court signed the dissolution judgment. Id. The husband then moved to eliminate spousal support and to reduce child support, which the court denied on the basis that the job loss had occurred before the judgment was signed. Id. We reversed. Id. We first explained that, even if the husband's job loss was "anticipated" at the time of trial, "it ought not have been considered in fixing his support obligations," because it remained "speculative" at that time. Id. at 160, 662 P.2d 795. We...
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