Portugal v. Portugal

• Decision Date: 01 May 2002
• Citation: 798 A.2d 246
• Parties: Lorie PORTUGAL, Appellee, v. Howard PORTUGAL, Appellant. Lorie Portugal, Appellant, v. Howard Portugal, Appellee.
• Court: Pennsylvania Superior Court

798 A.2d 246

Lorie PORTUGAL, Appellee, v. Howard PORTUGAL, Appellant.

Lorie Portugal, Appellant, v. Howard Portugal, Appellee.

Superior Court of Pennsylvania.

Argued February 12, 2002.

Filed May 1, 2002.

Mark A. Momjian, Philadelphia, for Howard Portugal.

Terry W. Vanderpool, West Chester, for Lorie Portugal.

Before FORD ELLIOTT, JOYCE and BECK, JJ.

JOYCE, J.

¶ 1 Wife, Lorie Portugal, appeals from the order entered on July 10, 2001, in the Court of Common Pleas of Chester County, directing her Husband, Howard Portugal, to make monthly support payments on behalf of their two minor children. Husband also files a cross-appeal from the same order. Upon review, we reverse and remand for further proceedings. The relevant facts and procedural history, as aptly stated by the trial court, are as follows.

[Husband] and [Wife] met while students at Rensselaer Polytechnic Institute in the 1980's. She majored in biology; he studied computer science. They married on June 14, 1987. After their marriage, [Wife] continued her education, obtaining a doctorate in veterinary medicine in 1992. In 1997, [Wife] opened her own veterinary care clinic, "Critter Care Veterinary Hospital, P.C.", to address the needs of small animals and exotic pets in the Thorndale area. In January 1999, [Husband] moved to Washington State to begin working for Microsoft Corporation as a Senior Applications Development Consultant. The company paid for his relocation. [Wife] and the couple's two young children, Matthew, born May 7, 1995, and Rebecca, born June 21, 1997, were to have joined him soon after. Instead, the separation became permanent.

[Wife] filed for spousal and child support on September 27, 2000. The court entered a Temporary Order on November 8, 2000 in the amount of $601.00 per month for spousal support and $2007.00 per month as child support. [Husband] moved for a separate listing on the same day. [The trial court] held an evidentiary hearing on June 13, 2001 at which both parties appeared and were represented by counsel. At the hearing, [Wife] agreed to the dismissal of her spousal support claim on the grounds of cohabitation.

Trial Court Opinion, 7/10/01 at 3-4. On July 10, 2001, the trial court entered an order that directed Husband to pay $1599.00 in child support per month from September 27, 2000 until December 31, 2000 and to pay $1625.00 per month thereafter. The trial court also ordered Husband to provide health insurance for the parties' children and to pay fifty-six percent (56%) of the children's unreimbursed medical expenses. Furthermore, since Wife admitted that she was cohabitating with another man while receiving spousal support payments from Husband, the trial court ordered Wife to reimburse Husband at the rate of $200.00 per month. This appeal and cross appeal followed.

¶ 2 In her timely appeal, Wife raises the following issues for our review:

1. Whether Wife's earning capacity should have been used when she testified that she was trying to build her business and would eventually surpass her colleagues who worked for other veterinarians.

2. Whether Husband's income was correctly calculated, given the perquisites given to him by his company with regard to relocation.

3. Whether Husband's income was correctly calculated, given the fact that his 401(k) contribution was deducted from his gross income.

4. Whether the court's calculation of the taxes to be paid by each party, in consideration of the exemptions given to each party, was correct.

5. Whether the court's calculation of support was incorrect, given the correct findings in regard to the parties' respective incomes.

Appellant's Brief, at 3 (full capitalization omitted).

¶ 3 In his timely cross-appeal, Husband raises the following issues:

1. Whether the trial court committed legal error, abused its discretion, or misapplied the law in failing to direct Wife to cede one of the child dependency exemptions for federal income tax purposes to Husband?

2. Whether the trial court erred, abused its discretion, or misapplied the law in failing to order Wife to pay back in a lump sum the credit owed to Husband as a result of Wife's bad faith continuation of her spousal support claim from the date of filing to the date of hearing?

3. Whether the trial court erred, abused its discretion, or misapplied the law in refusing to allow Husband to make direct payments to the provider for his portion of the childcare expenses?

Cross-Appellant's Brief, at 6.

¶ 4 In child support cases, our standard of review is as follows:

The amount of a support order is largely within the discretion of the trial court, whose judgment should not be disturbed on appeal absent a clear abuse of discretion. An abuse of discretion is not merely an error of judgment, but rather a misapplication of the law or an unreasonable exercise of judgment. A finding that the trial court abused its discretion must rest upon a showing by clear and convincing evidence, and the trial court will be upheld on any valid ground.

Kessler v. Helmick, 449 Pa.Super. 113, 672 A.2d 1380, 1382 (1996) (quoting Griffin v. Griffin, 384 Pa.Super. 188, 558 A.2d 75, 77 (1989) (en banc)). For our purposes, "an abuse of discretion requires proof of more than a mere error of judgment, but rather evidence that the law was misapplied or overridden, or that the judgment was manifestly unreasonable or based on bias, ill will, prejudice or partiality." Kersey v. Jefferson, 791 A.2d 419, 423 (Pa.Super.2002) (citations omitted).

¶ 5 In her first issue, Wife argues that the trial court abused its discretion when it based her monthly income for support purposes on her earning capacity rather than on her actual monthly income. Appellant's Brief, at 18. After the parties' hearing, the trial court determined that an individual of Wife's qualifications could earn $55,000.00 per year as an associate veterinarian in an established clinic. Wife argues, however, that the trial court should not have charged her with this earning capacity because she never actually held such a position and because her husband supported her decision to open her own clinic. Id. Additionally, Appellant maintains that her future earnings as a self-employed veterinarian will eventually surpass those of her colleagues and will make up for her current limited income. Id.

¶ 6 In this Commonwealth, it is well settled that

[c]hild support is a shared responsibility requiring both parents to contribute to the support of their children in accordance with their relative incomes and ability to pay. Depp v. Holland, 431 Pa.Super. 209, 636 A.2d 204, 208 (1994) (citing DeWalt v. DeWalt, 365 Pa.Super. 280, 529 A.2d 508 (1987)). "Where a party voluntarily assumes a lower paying job, there generally will be no effect on the support obligation." Pa.R.C.P. 1910.16-2(d)(1).... Where a party willfully fails to obtain appropriate employment, his or her income will be considered to be equal to his or her earning capacity. Pa.R.C.P.1910.16-2(d)(4). A determination of earning capacity must consider the party's age, education, training, health, work experience, earnings history, and child care responsibilities. Id.

Kersey, 791 A.2d at 423. Accord DeMasi v. DeMasi, 366 Pa.Super. 19, 530 A.2d 871, 877 (1987) (holding that "[a] parent's ability to pay support is determined primarily by financial resources and earning capacity.... The obligation of support, then, is measured more by earning capacity than by actual earnings.")

¶ 7 In the instant case, the parties stipulated that Wife would earn $55,000.00 per year if she worked as an associate veterinarian at an established clinic. N.T. Support Hearing, 6/13/01 at 69. Nonetheless, Wife opted to establish her own clinic and currently earns $25,000.00 as its proprietor. Although we recognize that Wife did not voluntarily depart from an associate position that paid $55,000.00 and that Husband supported Wife's decision to open the clinic, the income Wife currently receives is simply not commensurate with her admitted earning potential.

¶ 8 Our court's decision in Commonwealth ex rel. Raitt v. Raitt, 203 Pa.Super. 226, 199 A.2d 512 (1964) is instructive. In Raitt, a father possessing a doctorate degree in pharmacology voluntarily assumed a position as a local pharmacist instead of seeking a higher paying position with a pharmaceutical research company. Id. at 513. Finding that the father's actual earnings did not equal his earning potential, the trial court based the father's support obligation on his earning capacity. Id. On appeal, a panel of our Court provided:

The court below was correct in considering the earning capacity of the defendant. Usually a defendant's earnings represent his earning capacity, but this is not always true and where the court is justified, as here, in finding that the defendant's earning capacity exceeds his earnings, the amount of the order should be determined on the basis of earning capacity.

Id.

¶ 9 Like the father in Raitt, Wife voluntarily assumed a lower paying position in the face of more lucrative opportunities. Therefore, we do not find that the trial court abused its discretion when it based Wife's income for support purposes on her earning capacity. To hold otherwise would permit Wife to subordinate the immediate financial needs of her children to her own aspirations. See Kersey, 791 A.2d at 424.

¶ 10 In her second and third issues, Wife maintains that the trial court abused its discretion when it failed to consider that Husband's earning capacity/income is enhanced by certain "corporate perquisites." Appellant's Brief, at 20-1. Specifically, Wife argues that the reimbursement Husband received from Microsoft for his relocation expenses, Husband's bonuses, Husband's contributions to his 401(k) and Microsoft's matching contribution to Husband's 401(k) should have been considered as income for support purposes. Id. We will discuss each of these perquisites in turn.¹

¶ 11 In 2000, Appellant left his...