Smith v. Smith, 940390

• Decision Date: 27 September 1995
• Docket Number: No. 940390,940390
• Citation: 538 N.W.2d 222
• Parties: Sheldon A. SMITH, Plaintiff, Appellant and Cross-Appellee, v. Carla J. SMITH, Defendant, Appellee and Cross-Appellant. Civ.
• Court: North Dakota Supreme Court

Page 222

538 N.W.2d 222

Sheldon A. SMITH, Plaintiff, Appellant and Cross-Appellee, v. Carla J. SMITH, Defendant, Appellee and Cross-Appellant.

Civ. No. 940390.

Supreme Court of North Dakota.

Sept. 27, 1995.

Scott K. Porsborg (argued), of Smith Bakke Hovland & Oppegard, Bismarck, for plaintiff, appellant and cross-appellee. Appearance by Sheldon A. Smith.

Irvin B. Nodland (argued), Bismarck, for defendant, appellee and cross-appellant.

NEUMANN, Justice.

Sheldon A. Smith appeals and Carla J. Smith cross-appeals from an amended judgment modifying Sheldon's child support obligation. We affirm in part, reverse in part, and remand for further proceedings.

Sheldon and Carla are both attorneys. They were divorced in January 1992 under a stipulation which, in part, distributed their marital estate and debts and granted Carla "custodial care" of the parties' two minor children. The stipulation said:

"The parties agree that child support will be paid by the husband to the wife in the amount of $1,250.00 total per month.

"The parties agree that the child support is the husband's contribution to one-half of the ordinary and reasonable living expenses of the children. The parties agree that the husband shall not be obligated, in any form whatsoever, to help provide support to the wife. The parties further agree that each party, in addition to providing support for the children, will provide all of their own independent help for the children for items such as vacations, extracurricular activities which are not necessary for the child's actual health and well being. The parties agree to reevaluate the $1,250.00 on or about January 1, 1993 to determine if the $1,250 adequately reflects one-half of the children's reasonable and necessary expenses.

"The proportionate child support shall cease upon each child's completion of high school or attaining the age of nineteen whichever is earlier. The husband agrees to pay a reasonable share of the children's expense incurred by the wife while they are attending college. The husband shall get one exemption for income tax purposes and the wife agrees to execute such documents as are necessary for IRS purposes. The husband also agrees to pay up to one-half of reasonable tuition, room and board for the children for up to four years of college as long as the child is a fulltime student and has passing grades."

In December 1993, Carla filed a motion to vacate the divorce judgment, ¹ seeking to move the children from Bismarck to Minneapolis, Minnesota, and to increase Sheldon's child support obligation to the amount required by the child support guidelines. Sheldon countered with a motion for change of custody. The trial court denied Carla's request to move the children to Minneapolis, denied Sheldon's motion for change of custody, and increased his child support obligation to $1,823 per month.

SHELDON'S APPEAL

I

Sheldon contends the trial court erred in increasing his child support obligation. He does not dispute the stipulated amount of his child support obligation, $1,250 per month, is less than required under the child support guidelines. He argues, however, the court erred in applying the guidelines to compute his child support obligation, because the parties' stipulation rebutted the presumptive amount of support under the guidelines.

Section 14-09-09.7(3), N.D.C.C., creates "a rebuttable presumption that the amount of child support that would result from the application of the child support guidelines is the correct amount of child support." The presumption may be rebutted if, applying criteria enacted by the Department of Human Services which take into consideration the best interests of the child, a preponderance of evidence establishes the guideline amount is not the correct amount of child support. ² N.D.C.C. Sec. 14-09-09.7(3). Sheldon's argument involves the interrelationship of the presumptive amount of child support under the guidelines, the parties' stipulation and a trial court's continuing jurisdiction to modify child support.

We have said parental stipulations regarding child support are legitimate incidents of parental authority and control and are entitled to serious consideration by a court. Tiokasin v. Haas, 370 N.W.2d 559 (N.D.1985). However, notwithstanding a parental agreement, a trial court has continuing jurisdiction under N.D.C.C. Sec. 14-05-24 to modify child support. Reimer v. Reimer, 502 N.W.2d 231 (N.D.1993); Rueckert v. Rueckert, 499 N.W.2d 863 (N.D.1993).

In Rueckert, we considered a trial court's continuing jurisdiction to modify child support in the context of a parental stipulation in which the noncustodial parent relinquished claims to certain marital property in lieu of paying any future child support. We said:

"Although we encourage settlements in divorce actions ... '[w]e take a dim view of agreements purporting to sign away the rights of a child in support settings--not from a contractual background, but from a public policy one.... Due to the nature of domestic relations, we do not analyze transactions and compromises between the parties in a cold contractual frame--public policy plays a large role in determining the factors of which parties may contract in domestic relations settings.' "

Rueckert, 499 N.W.2d at 867.

We held that, based on the strong public policy for adequate support and maintenance of minor children, "parental agreements that prohibit or limit the power of a court to modify future child support are invalid." Rueckert, 499 N.W.2d at 868. We concluded the parties' stipulation violated public policy and was invalid. In Reimer, we followed Rueckert and held that a similar stipulation also contravened public policy and was invalid.

Under Rueckert, Reimer, and N.D.C.C. Sec. 14-05-24, although a parental stipulation for child support is entitled to serious consideration, a trial court has continuing jurisdiction to modify support notwithstanding the stipulation. In both Rueckert and Reimer, the stipulations resulted in noncustodial parents waiving their rights to certain marital property in lieu of paying any future child support. In both cases the noncustodial parents made no child support payments, and our decisions rested on the overriding public policy that the best interests of the children require child support obligors to provide adequate support and maintenance for their minor children.

In O'Callaghan v. O'Callaghan, 515 N.W.2d 821 (N.D.Ct.App.1994), the court of appeals considered a parental stipulation in which the obligor agreed to pay more child support than required by the guidelines. The court of appeals said the agreement effectively furthered the best interests of the children by requiring more support than mandated by the guidelines and, therefore, did not violate the public policy for adequate support and maintenance for minor children. The court of appeals affirmed the trial court's determination that the parties' stipulation rebutted the presumptively correct amount of child support. Under O'Callaghan, the best interests of the children and public policy are satisfied by parental stipulations that require an obligor to pay more child support than required by the guidelines.

Here, relying on O'Callaghan, Sheldon asserts the parties' stipulation requires him to pay more current and future child support than mandated by the guidelines. Sheldon thus argues the stipulation satisfies the best interests of the children and rebuts the presumptively correct amount of support under the guidelines. We disagree.

In rejecting Sheldon's argument, the trial court ruled:

"Recognizing that the parties specifically agreed that Sheldon's child support obligation was subject to reevaluation (i.e., on or about January 1, 1993), and finding that the parties' agreement does not obligate Sheldon to pay current support in an amount greater than what would be required pursuant to the North Dakota Child Support Guidelines, the Court determines that Sheldon's child support obligation is fully reviewable--and may be modified either upward or downward as may be appropriate- --at this point in time." (Emphasis in original).

The parties' stipulation said Sheldon's child support obligation was subject to reevaluation in January 1993 to determine if it adequately reflected half of the children's reasonable and necessary expenses. To the extent the stipulation purports to mechanically restrict Sheldon's child support obligation to half of the children's reasonable and necessary expenses, it violates public policy expressed in the child support guidelines by limiting the power of the court to modify future child support. Reimer; Rueckert.

Sheldon's attempt to quantify his expenditures while the children are with him and his future expenditures for the children's college expenses is speculative ³ and not persuasive. The guidelines "assume that the care given to the child during temporary periods when the child resides with the obligor ... do not substitute for the child support obligation." N.D.A.C. Sec. 75-02-04.1-02(2). Moreover, the parties' stipulation requires both Sheldon and Carla to pay half of the children's reasonable tuition and room and board for up to four years of college. It also requires Sheldon to pay a reasonable share of the children's expenses incurred by Carla while the children attend college. The stipulation recognizes a shared obligation by Carla and Sheldon for the children's college expenses. See N.D.C.C. Sec. 14-09-08 (recognizing mutual duty of each parent to provide children with support and education suitable to the children's circumstances).

We agree with the trial court that the parties' stipulation does not elevate Sheldon's current child support obligation to an amount greater than required by the guidelines. This case is therefore distinguishable from O'Callaghan. The parties' stipulation does not rebut the presumptive amount of support under the guidelines, and we hold the trial court...