Quintana v. Eddins

• Decision Date: 12 December 2001
• Docket Number: No. 21,882.,21,882.
• Parties: Judith QUINTANA, Petitioner-Appellee, v. Owens EDDINS, Jr., Respondent-Appellant.
• Court: Court of Appeals of New Mexico

38 P.3d 203

131 N.M. 435

2002 NMCA 8

Judith QUINTANA, Petitioner-Appellee, v. Owens EDDINS, Jr., Respondent-Appellant.

No. 21,882.

Court of Appeals of New Mexico.

December 12, 2001.

Rachel A. Brown, Hubert & Hernandez, P.A., Las Cruces, NM, for Appellee.

Mary W. Rosner, Las Cruces, NM, for Appellant.

OPINION

PICKARD, Judge.

{1} In this appeal, we consider whether a parent is underemployed for the purpose of imputing income in determining child support when the parent is working full time in his area of expertise, but is earning less than he had made previously when employed in a different state and less than he could make if he had accepted a position with a private company rather than with a state institution. In addition, we determine whether dividend and interest income earned on a self-employed pension, individual retirement account (SEP-IRA) may be treated as income in calculating child support. {2} We hold that as long as a parent is working full time in his area of expertise, earning an amount of money within the range presented by the evidence, and in a location reasonably accessible to his child, the trial court may not find that he is underemployed without making a specific finding of bad faith. We accordingly reverse the trial court's finding that Father is currently underemployed to the extent found by the trial court, and we instruct the trial court to recalculate child support based on an annual salary of $50,000. We affirm the trial court's inclusion of the income generated by Father's SEP-IRA in the determination of Father's child support obligation. Finally, although we conclude that the trial court did not abuse its discretion in awarding Mother attorney fees given the disparity in resources available to the parties, we remand to the trial court for reconsideration of the award in light of the fact that Father's actual income is not substantially greater than Mother's income and in light of the parties' relative successes on appeal.

FACTS AND PROCEDURAL HISTORY

{3} Appellant Owen Eddins (Father) met Appellee Judith Quintana (Mother) in 1997. Father was employed as an independent computer programmer in the San Francisco Bay area, and Mother worked as a school counselor in Las Cruces, New Mexico. In March 1998, Father ceased working as a computer programmer. Two months later, Mother learned that she was pregnant. Father moved to Las Cruces in October 1998, to pursue his relationship with Mother and to enroll in graduate school. From October 1998 until June 1999, Father and Mother lived together in Mother's home in Las Cruces. Father attended classes and Mother continued to work as a counselor. Child was born on December 13, 1998.

{4} Mother and Father separated on June 24, 1999. Two weeks later, Mother filed a petition to establish paternity, custody, and child support. At the time that the petition was filed, Father remained unemployed. In November 1999, Mother filed a motion for interim child support, and a hearing was held in January 2000. At the time of the hearing, Father had secured a telecommuting position in which he worked 30 hours per week and which paid $20,000 per year. Father testified that he accepted the position because it allowed him to work at home and did not require him to work during the day time, when he had visitations with his daughter. He further stated that it was his intention not to seek full-time employment so that he could be a stay-at-home parent. Mother introduced evidence that, while employed full time as an independent computer consultant in California, Father earned approximately $155,000 per year. The hearing officer found that Father was underemployed and imputed to Father a yearly earnings of $155,065.00. Father appealed the hearing officer's decision to the district court, which considered the matter de novo at a hearing held on custody and support issues in June 2000.

{5} After the interim award of child support was entered, Father's employer offered Father a full-time position at a salary of $40,000 per year. Father declined the offer. However, prior to trial, Father accepted a full-time position at the University of New Mexico (UNM) in Albuquerque. The position requires Father to work 40 hours per week and pays approximately $46,000 per year.

{6} Despite the fact that Father had since obtained full-time employment, Mother continued to argue at trial that Father was underemployed and requested that the trial court award child support based on Father's earning potential rather than his actual income. In support of her argument, Mother introduced evidence, through two witnesses and the cross-examination of Father, that Father had earned substantially more income while employed in California and had the potential to earn more income either in California or in New Mexico. Based on this testimony, the trial court affirmed the hearing officer's finding that Father was underemployed and imputed to Father income of $90,000 per year.

{7} In addition to imputing income based on Father's alleged earning potential, the trial court found that Father owned a SEP-IRA worth approximately $160,000. Father testified that the value of the SEP-IRA increased by $7,589 in the first three quarters of 1999. An exhibit, Father's 1999 Form 1099 for the SEP-IRA, indicated $7,589 in dividends and capital gains of $689. Father's reply brief concedes that the $7,589 is accurately characterized as interest. The trial court included $7,000 of interest as income when it calculated Father's child support obligation. Finally, based on its finding of a disparity in income and financial resources between the parties, the trial court awarded Mother $15,000 in attorney fees, pursuant to NMSA 1978, § 40-4-7(A) (1997).

{8} Father appeals, arguing that the trial court abused its discretion in three ways: (1) in finding that Father was underemployed and in imputing to Father an annual income of $90,000, (2) in including as income for child support purposes $7,000 per year of the interest earned on Father's SEP-IRA and in stating that Father's SEP-IRA should be considered a reserve fund available to meet his child support obligation in case Father chooses not to earn more money by changing jobs, and (3) in awarding Mother $15,000 in attorney fees.

DISCUSSION

Standard of Review

{9} The setting of child support is left to the sound discretion of the trial court as long as that discretion is exercised in accordance with the child support guidelines. See Styka v. Styka, 1999-NMCA-002, ¶ 8, 126 N.M. 515, 972 P.2d 16

. The guidelines require the trial court to make findings regarding the income of both parents and to calculate support obligations based on these findings. NMSA 1978, § 40-4-11.1(E) (1995); see also Major v. Major, 1998-NMCA-001, ¶ 4, 124 N.M. 436, 952 P.2d 37. We review the trial court's factual findings to determine whether they are supported by substantial evidence. See Styka, 126 N.M. 515,

972 P.2d 16, 1999-NMCA-002, ¶ 8. In conducting this review, we view the evidence in the light most favorable to the prevailing party and indulge all reasonable inferences in support of the findings. See Las Cruces Prof'l Fire Fighters v. City of Las Cruces, 1997-NMCA-044, ¶ 12, 123 N.M. 329, 940 P.2d 177. Finally, to the extent that Father's appeal requires us to consider questions of law, we review these questions de novo. See Styka, 126 N.M. 515,

972 P.2d 16, 1999-NMCA-002, ¶ 8.

Imputation of Income

{10} Section 40-4-11.1(C)(1) defines income as "actual gross income of a parent if employed to full capacity or potential income if unemployed or underemployed." At trial, Mother and Father both introduced evidence regarding Father's actual and potential income. This evidence is best characterized as falling into two general categories: (1) Father's actual and potential income in California and (2) Father's actual and potential income in New Mexico. The evidence regarding California is as follows. While employed as an independent consultant in 1997 and 1998, Father earned approximately $155,000 per year. Gail Sherman, a senior technical recruiter from the San Francisco Bay area, testified regarding Father's current earning potential in California. Ms. Sherman testified that an individual with Father's skills could expect to make $90,000 per year in the Bay area. Although she acknowledged a lack of familiarity with the New Mexico job market and of the average wage of computer programmers in New Mexico, Ms. Sherman testified that it was possible that Father could telecommute from New Mexico to California. Ms. Sherman did not testify regarding the salary range for such positions, but opined that Father was underpaid at $46,000.

{11} With respect to Father's income while living in New Mexico, the evidence showed that, at the time of the hearing on Mother's motion for interim child support, Father was employed 30 hours per week at a salary of $20,000 per year. After the hearing but before trial, Father's employer offered Father a full-time job with a salary of $40,000 per year. Father declined this offer and later accepted a full-time position with UNM at a salary of $46,000 per year.

{12} At trial, Tom Herndon, who had programming experience similar to Father's and who had spoken with Father regarding the possibility of telecommuting between California and New Mexico, testified that he worked in the same field as Father, had been employed in Arizona for three years, and, at the time of trial, earned $64,200 per year. He further testified that Father had told him that he could earn more money by telecommuting. Finally, Mr. Herndon testified that, although he was not allowed to telecommute in his current position, his supervisor was considering allowing employees to telecommute in the future.

{13} While testifying, Father acknowledged that he could earn $60,000 per year in New Mexico if he accepted a position with a private business, such as Intel. He testified that he had not...