Schmidt v. Reamann, 940194

• Decision Date: 27 October 1994
• Docket Number: No. 940194,940194
• Citation: 523 N.W.2d 70
• Parties: Diane SCHMIDT, Plaintiff and Appellee, v. James REAMANN, Defendant and Appellant. Civ.
• Court: North Dakota Supreme Court

Page 70

523 N.W.2d 70

Diane SCHMIDT, Plaintiff and Appellee, v. James REAMANN, Defendant and Appellant.

Civ. No. 940194.

Supreme Court of North Dakota.

Oct. 27, 1994.

Edward H. Johnson of Worthington Law Firm, Bismarck, for defendant and appellant.

Sheila K. Keller of Regional Child Support Enforcement Unit, Bismarck, for plaintiff and appellee.

LEVINE, Justice.

James Reamann appeals from an order denying his motion to reduce his monthly child support obligation. The district court found no material change of circumstances since the last modification hearing. We affirm.

In July 1987, the parties stipulated to James Reamann's paternity of Diane Schmidt's child and the district court ordered Reamann to pay $65.00 per month as child support. In September 1993, the Bismarck Regional Child Support Enforcement Unit [RCSEU] initiated a review of the 1987 support order under the then-applicable temporary section of NDCC ch. 14-09, requiring periodic review of support orders enforced by RCSEU. See State ex rel. Younger v. Bryant, 465 N.W.2d 155, 157 n. 1 (N.D.1991) (setting forth section 16 of chapter 148, S.L. 1989, creating the temporary section of ch. 14-09, effective October 1, 1990, through October 1, 1993).

At the modification hearing, held in October of 1993, the referee found that Reamann was self-employed as a farmer and, using income tax returns provided by Reamann, averaged his income over the five-year period, 1987 to 1991. See N.D.Admin.Code 75-02-04.1-05(3). As a result of this computation, the referee determined that Reamann's average net monthly income was $771.00. Applying the child support guidelines, the referee determined that Reamann's child support obligation should be $168.00 per month. However, the referee also found that "the Defendant's situation does create somewhat of a hardship for him to meet that amount" and recommended that Reamann's support obligation be increased to only $145.00 per month, reflecting a fifteen percent downward deviation from the recommended guideline amount. The district court confirmed the referee's findings and recommendations on December 13, 1993, and amended the original child support judgment to reflect an increase in support from $65.00 to $145.00 per month.

On March 25, 1994, six months after the October modification hearing, Reamann made a motion to modify the amended judgment, based on a "continued erosion of his farm income." He offered tax returns from 1992 and 1993 in support of his motion. Reamann estimated that use of his 1992 and 1993 tax returns, in place of his 1987 and 1988 tax returns, would result in a child support obligation of only $56.00 per month.

The district court found that "[t]he only change in circumstances disclosed is the availability of the 1993 tax return, which was not available at the October hearing." The district court concluded that the mere availability of the 1993 tax return did not constitute a material change in circumstances permitting a reduction in Reamann's support obligation and denied the motion.

Reamann appeals, arguing that the reduction in his income for both 1992 and 1993 is a material change in circumstances, permitting a reduction of his child support obligation. Because Reamann seeks modification of his child support obligation less than one year after the previous modification, he is required to demonstrate a material change in circumstances has occurred since the October 1993 hearing. NDCC Sec. 14-09-08.4(3); Rueckert v. Rueckert, 499 N.W.2d 863 (N.D.1993).

A trial court's decision not to modify an obligor's child support obligation because there has been no material change in circumstances is a finding of fact which will not be reversed unless clearly erroneous. Hartman v. Hartman, 466 N.W.2d 155 (N.D.1991). Findings of fact are presumptively correct and Reamann bears the burden of demonstrating that the district court's findings are clearly erroneous. Gabel v. Gabel, 434 N.W.2d 722 (N.D.1989). A finding is clearly erroneous when, although there is some evidence to support it, a reviewing court is left with a definite and firm conviction that a mistake has been made. Id.

Traditionally, a change in the financial circumstances of either party was considered a significant factor in child support modification proceedings. See Gabel, 434 N.W.2d at 723. However, only if the change was neither contemplated nor foreseen by the parties at the time of the prior modification hearing was it considered a material change in circumstances. See Cook v. Cook, 364 N.W.2d 74 (N.D.1985). While the child support guidelines, chapter 75-02-04.1, N.D.Admin.Code, now look exclusively to the income of the obligor as the defining factor for child support, section 75-02-04.1-10, N.D.Admin.Code, the guidelines have not altered the substance of our case law that a change of circumstances is one that is neither contemplated nor foreseen. In a sense, a motion to modify is like a request for a new trial based on newly discovered evidence which could not have been discovered and produced at the trial. See NDRCivP 59(b)(4).

The last modification hearing in this case was held in October of 1993. At that hearing, the parties did not follow the correct procedure for acquiring Reamann's relevant tax returns. Section 75-02-04.1-05(3) of the N.D.Admin.Code says that the average income from the five most recent years of farm operation should be used to determine a farmer-obligor's income. In addition, NDCC Sec. 14-09-08.6(1) places the burden on the obligor to produce information concerning the obligor's income when a child support order is being reviewed. If tax returns are the chosen method of producing information, then subsection (b) of the statute directs the obligor to provide the "latest income tax return ... which accurately reports the obligor's income for a fiscal year ending no more than seventeen months prior to the date of the review." Id. That requirement called for Reamann's tax returns for 1992, 1991, 1990, 1989 and 1988 to be used at the October 1993 hearing. However, Reamann did not provide his 1992 tax return, so the referee...