Pomarleau v. Pomarleau
| Decision Date | 21 January 2022 |
| Docket Number | No. 20210083,20210083 |
| Citation | 969 N.W.2d 430 |
| Parties | Michael R. POMARLEAU, Plaintiff, Appellant, and Cross-Appellee v. Tanya M. POMARLEAU, Defendant, Appellee, and Cross-Appellant and State of North Dakota, Statutory Real Party in Interest |
| Court | North Dakota Supreme Court |
Rodney E. Pagel, Bismarck, ND, for plaintiff, appellant, and cross-appellee.
Amanda J. Welder, Bismarck, ND, for defendant, appellee, and cross-appellant.
[¶1] Michael Pomarleau appeals from a divorce judgment and amended divorce judgment. On appeal, Michael Pomarleau challenges the calculation of Tanya Pomarleau's income for child support obligations, the allocation of child tax credits, allowing an off-set to Tanya Pomarleau's equity payment, and the valuation of various items of property. Tanya Pomarleau cross-appeals, arguing the district court erred in failing to make an adjustment to the net marital estate for expenses incurred by the parties during their separation and in calculating the royalty payments received by the parties during the separation. We affirm in part, concluding the district court did not err in distribution, accounting, and valuation of the net marital estate, or in its allocation of the child tax credits. We reverse in part, concluding Michael Pomarleau's income was overstated and Tanya Pomarleau's income was understated, and reverse and remand for recalculation of the parties’ income for child support purposes consistent with this opinion.
[¶2] Michael Pomarleau and Tanya Pomarleau were married in 1999 and have three children. In June 2018, the parties separated. In December 2020, following a trial, the district court entered a memorandum and order in which it calculated the parties’ child support obligations, distributed the parties’ property, and ordered Tanya Pomarleau to make an equity payment to Michael Pomarleau to equalize the property distributions. The equity payment was off-set by the health insurance costs Tanya Pomarleau incurred for the children and Michael Pomarleau while the divorce was pending.
[¶3] Both parties challenged provisions of the memorandum and order. Michael Pomarleau challenged the calculation of Tanya Pomarleau's income for child support purposes and the valuation of the parties’ assets. Tanya Pomarleau challenged the calculation of Michael Pomarleau's income for child support purposes and the valuation of the oil royalties on mineral interests since the time of the parties’ separation. In January 2021, the district court entered judgment consistent with the memorandum and order. Michael Pomarleau appealed, and Tanya Pomarleau cross-appealed.
[¶4] This Court remanded to allow the court to resolve the parties’ post-judgment motions. The court concluded that Tanya Pomarleau had valid reasons to change jobs and reduce her income, and found it was appropriate to use her current income rather than her previous, higher salary to calculate her child support obligation. The court calculated her income the same as in the January 2021 judgment. The amended judgment was entered in July 2021, and Michael Pomarleau filed a supplemental appeal.
[¶5] On appeal, Michael Pomarleau raises several arguments. He argues the district court erred in calculating Tanya Pomarleau's income, asserting the court should have found she voluntarily reduced her income and used her previous, higher income to calculate her child support obligation. He further argues that the court overstated his income and understated Tanya Pomarleau's income by failing to evenly split the royalty income between the parties in the calculation of the parties’ incomes. He asserts the court erred in allocating the child tax credits and valuing items of property, including the marital home, business assets, personal property, financial assets, and debts. He also challenges the off-set of Tanya Pomarleau's equity payment to him by the health insurance premiums she incurred for him and the children during the divorce proceedings.
[¶6] On her cross-appeal, Tanya Pomarleau asserts two errors. First, she argues the district court erred in failing to make an adjustment to the net marital estate or otherwise order reimbursement from one party to another for expenses incurred during the divorce proceedings. Second, she argues the court erroneously calculated the royalty payments received by the parties during the divorce proceedings.
[¶7] Michael Pomarleau challenges the district court's calculation of Tanya Pomarleau's income for child support purposes. He argues that Tanya Pomarleau voluntarily reduced her income, and accordingly, her past, higher income should be utilized, or alternatively, her income should be averaged to account for fluctuations. Michael Pomarleau also argues that the court's failure to allocate the parties’ royalty income results in an overstatement of his income and an understatement of Tanya Pomarleau's income.
[¶8] When reviewing a district court's calculation of child support, we utilized a mixed standard of review:
Child support determinations involve questions of law which are subject to the de novo standard of review, findings of fact which are subject to the clearly erroneous standard of review, and may, in some limited areas, be matters of discretion subject to the abuse of discretion standard of review. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence exists to support it, or if, on the entire record, we are left with a definite and firm conviction that a mistake has been made.
Eubanks v. Fisketjon , 2021 ND 124, ¶ 6, 962 N.W.2d 427 (quoting Gooss v. Gooss , 2020 ND 233, ¶ 14, 951 N.W.2d 247 ) (internal quotations and citations omitted). "The failure to properly apply the child support guidelines to the facts involves an error of law." Gooss , 2020 ND 233, ¶ 15, 951 N.W.2d 247 (quoting references omitted). "A district court must clearly set forth how it arrived at the amount of income and the level of support." Id. ().
[¶9] We first consider whether the district court erred in finding that Tanya Pomarleau had valid reasons to change employment, resulting in a lower income, and basing her child support income on her current lower income.
[¶10] The North Dakota Administrative Code defines "gross income" and "net income," and the North Dakota Century Code defines "income." See N.D. Admin. Code §§ 75-02-04.1-01(4) and 75-02-04.1-01(6), and N.D.C.C. § 14-09-09.10(9). The Administrative Code provides that if an obligor makes a voluntary change in employment—a voluntary change being one taken with the purpose of reducing their child support obligation—the court may impute the obligor's income. N.D. Admin. Code § 75-02-04.1-07(7). See Logan v. Bush , 2000 ND 203, ¶ 14, 619 N.W.2d 501 ( .
[¶11] Here, the district court explained how it arrived at its calculation for Tanya Pomarleau's child support obligation. In the original memorandum and order, the court found Tanya Pomarleau's income decreased as a result of switching from commission-based employment to salaried employment. It then based her child support obligation on her current monthly salary. The court confirmed this finding in its order for the amended judgment, finding:
Tanya's higher earning years required her to work long hours for commission earnings in an uncertain market. During that time, she had a spouse with a good income to pay expenses if her commissions were lacking and to assist with child care and other family matters. As a single parent, Tanya testified that she wanted employment which provided her with a guaranteed salary so that she was no longer entirely dependent upon commissions and which also gave her more time to be with the children. She continues to earn a good income and an income comparable to the income earned by Michael. The court finds these to be legitimate reasons for Tanya to change employment and not an intentional reduction of income to minimize her child support obligation.
It again based Tanya Pomarleau's child support obligation on her current $126,000 salary. While the district court had the discretion to calculate Tanya Pomarleau's child support obligation on her previous, higher income, it was not mandatory to do so. We conclude the court complied with the N.D. Admin. Code and Century Code when using Tanya Pomarleau's current income in calculating her child support obligation, there is evidence in the record to support the finding, and, after a review of the entire record, we are not left with a definite and firm conviction a mistake has been made.
[¶12] We next consider whether the district court erred in failing to allocate the parties’ royalty income, resulting in an overstatement of Michael Pomarleau's income and understatement of Tanya Pomarleau's income.
[¶13] Prior to trial, Michael Pomarleau stipulated to his income. His stipulated income included an assumption he would be receiving all of the parties’ royalty income in the future. If Michael Pomarleau had challenged only the overstatement of his income, we would have likely considered the issue waived and declined to address the issue. However, Michael Pomarleau challenges both the overstatement of his income and the understatement of Tanya Pomarleau's income. Because the latter issue is appropriate for review on appeal, and the two issues are so intertwined as to be inseparable, both issues will be resolved on appeal.
[¶14] During the divorce proceedings, Michael Pomarleau reported on his tax return all of the royalty income received in the interim separation period. As part of the property distribution, the district court...
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