Workman v. Workman
| Decision Date | 10 August 2001 |
| Docket Number | No. S-99-710.,S-99-710. |
| Parties | Albert A. WORKMAN, Jr., Appellee, v. Debra D. WORKMAN, Appellant. |
| Court | Nebraska Supreme Court |
Jon A. Sedlacek, Blair, for appellant.
Joseph A. Jordano and Carla Heathershaw Risko, of Fitzgerald, Schorr, Barmettler & Brennan, P.C., Omaha, for appellee.
Debra D. Workman and Albert A. Workman, Jr., were divorced in 1992. Albert was ordered to pay child support in the amount of $250 per month for the support of the parties' minor child. On January 21, 1998, Debra filed a petition to modify the decree, alleging that a material change in circumstances had occurred and seeking to have Albert's child support obligation increased.
It has not been contested, in the district court or on appeal, that there has been a material change in circumstances since the entry of the decree that justifies modification of the child support award. The issue at the hearing on Debra's petition, held on April 20, 1999, was the calculation of the parties' gross and net incomes, and specifically whether to include Albert's retirement plan contributions or the money given to Debra by her cohabitant to pay household expenses.
In a written order filed May 19, 1999, the district court determined that Albert's retirement plan contributions were mandatory contributions within the meaning of the Nebraska Child Support Guidelines (Guidelines). The district court further appears to have concluded that the $400 monthly contribution of Debra's cohabitant should be included in her income for purposes of calculating child support. The district court increased Albert's child support obligation to $300.04 per month, to commence on June 1.
Albert is self-employed as an independent insurance agent, contracting through, among others, Farm Bureau Insurance Company of Nebraska and Farm Bureau Insurance Company of Iowa (collectively Farm Bureau). Albert sells insurance and receives commissions from different companies, including Farm Bureau. Albert started his business in 1993.
Farm Bureau established a "matching program" in 1996. The matching program provided that if Farm Bureau agents established a qualified retirement plan and committed up to 7 percent of their commissions to the plan, Farm Bureau would match the agents' contributions. There would be no matching funds from Farm Bureau unless the agent established a plan. Roland Schobert, vice president of marketing for Farm Bureau Insurance Company of Nebraska, testified that no yearly retirement plan contribution is required by Farm Bureau from its agents. Schobert explained that the matching program required a "qualified retirement vehicle."
Albert, as an employer, established a plan in 1996 for himself and his employees; specifically, a "money purchase pension plan" offered through Farm Bureau. The Farm Bureau matching program did not require the particular use of a money purchase pension plan, and Albert testified that his decision to establish the plan was voluntary.
The plan requires, as relevant, annual contributions in the amount of 14 percent of Albert's commissions from the sale of property casualty and new life insurance policies. Once such a plan is established, the participant employer has no discretion as to the amount of money that must be contributed to the plan. The employer's contributions are required for continued participation in the plan. The plan, as established by Albert, requires 2 years of service, at 1,000 hours per year, for employees to be eligible to participate in the plan. At the time of the hearing, none of Albert's employees, other than himself, had qualified to participate in the plan.
Daniel Wintz, executive vice president and head of retirement plans for the SilverStone Group, defined a money purchase pension plan as a defined contribution plan where the annual contribution requirement of the employer is set forth in the document. Albert testified that Social Security taxes are paid on contributions to the plan, but no income taxes are paid on contributions until money is withdrawn from the plan. Wintz explained that the employer's contribution is required for the plan to be a qualified pension plan under the Internal Revenue Code and that a failure to make the required employer's contribution would jeopardize the tax-qualified status of the plan.
In 1998, $6,552 was contributed to Albert's retirement plan, one-half of which was Albert's contribution and one-half of which was Farm Bureau's matching contribution. In calculating his proposed child support obligation, using figures for 1998, Albert began with the net profit from his business, subtracted self-employment taxes, subtracted both his contribution and Farm Bureau's matching contribution to the retirement plan, and reached an annual income of $23,724, resulting in a gross monthly income for child support purposes of $1,977. The district court accepted this figure for purposes of calculating child support.
Debra was, at the time of hearing, working as a registered nurse at a local hospital. Debra was earning an hourly wage of $22.66 and was working 16 to 18 hours per week. Debra's income for 1998 was $47,013. Debra testified that she was diagnosed with renal disease in November 1998. Debra explained that her work hours had decreased due to the effects of the renal disease and that she was receiving dialysis treatment and was on a transplant list.
Debra testified that at the time of hearing, she was living with her daughter from her marriage to Albert, and her "significant other," whom we will refer to as her "cohabitant." Debra testified that her cohabitant paid $400 per month of household expenses. Debra explained that the $400 per month was not rent, but simply an amount that her cohabitant had agreed to give Debra to help pay expenses. Albert testified that at the time of hearing, he was married, and that his wife contributed to household expenses.
Debra's proposed child support calculation, taking into account the income reduction resulting from her renal disease, proposed a gross monthly income for Debra of $1,525. The district court apparently used this figure, but added $400 to account for the contributions of Debra's cohabitant.
Debra assigns that the district court erred (1) in finding Albert's contribution toward his retirement was mandatory and therefore not considered income for purposes of calculating child support and (2) in including, as income for purposes of calculating child support, the $400 per month Debra's cohabitant contributes to household expenses.
In addition, Albert argues that the district court "erred by not calculating [Debra's] contribution to child support based on her earning capacity as if she were fully employed." Brief for appellee at 14. However, Albert did not assign this as error, nor does Albert's brief set forth a cross-appeal pursuant to the rules of this court. A cross-appeal must be properly designated, pursuant to Neb. Ct. R. of Prac. 9D(4) (rev.2000), if affirmative relief is to be obtained. McDonald v. DeCamp Legal Servs., 260 Neb. 729, 619 N.W.2d 583 (2000); In re Interest of Natasha H. & Sierra H., 258 Neb. 131, 602 N.W.2d 439 (1999). An appellee may not raise arguments independent of or not responsive to an appellant's assignments of error without cross-appealing because they will fall beyond the scope of the case as presented in the appellant's brief. McDonald v. DeCamp Legal Servs., supra. Because Albert has not perfected a cross-appeal from the district court's ruling, we do not consider Albert's allegation of error.
Modification of the amount of child support payments is entrusted to the discretion of the trial court, and although, on appeal, the issue is reviewed de novo on the record, the decision of the trial court will be affirmed absent an abuse of discretion. Hartman v. Hartman, 261 Neb. 359, 622 N.W.2d 871 (2001); Riggs v. Riggs, 261 Neb. 344, 622 N.W.2d 861 (2001).
Interpretation of the Guidelines presents a question of law, regarding which an appellate court is obligated to reach a conclusion independent of the determination reached by the court below. See Riggs v. Riggs, supra.
Paragraph E of the Guidelines, entitled "Deductions," provides in pertinent part: The Guidelines do not, however, allow a deduction for contributions to voluntary retirement plans in arriving at net income for purposes of calculating child support. See Lebrato v. Lebrato, 3 Neb.App. 505, 529 N.W.2d 90 (1995).
The record reflects that the money purchase pension plan at issue in this case requires annual contributions. Mandatory retirement plan contributions are specifically defined by the Guidelines as "a minimum amount required by the plan." (Emphasis supplied.) Guidelines, paragraph E(4). A trial court should examine the applicable retirement plan documents utilizing this simple objective standard to determine whether a participating parent's individual contributions thereto are mandatory or voluntary.
The contrary rule urged by Debra is inconsistent with the plain language of the Guidelines. Under Debra's rationale, the owner of a business who adopted a money purchase plan for legitimate business reasons could be found to make "voluntary contributions" to the plan for purposes of child support computation, while an employee of the business who was not involved in the selection of the plan would be making mandatory contributions to the same plan. There would be no logic or equity in this result.
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