Opinion
No. 51454-7-I.
Filed: February 17, 2004. UNPUBLISHED OPINION
Appeal from Superior Court of King County. Docket No: 95-3-07092-6, Judgment or order under review. Date filed: 11/05/2002. Judge signing: Hon. J Kathleen Learned.
Counsel for Appellant(s), Thomas W Falkner, Perkins Coie LLP, 1201 3rd Ave Ste 4800, Seattle, WA 98101-3099.
Clark Reed Nichols, Perkins Coie LLP, 1201 3rd Ave Fl 40, Seattle, WA 98101-3029.
Counsel for Respondent(s), Patricia S. Novotny, Attorney at Law, 3418 NE 65th St. Ste a, Seattle, WA 98115-7397.
Findings of fact are required in connection with all final decisions in divorce proceedings and for all orders of child support, including orders in support-modification proceedings. In this case, no findings of fact or conclusions of law were entered on a number of issues. Proper review requires those findings. The case is reversed and remanded to the trial court for entry of findings of fact and conclusions of law.
FACTS
Cindy Martin and Gregg Hynek's marriage was dissolved in 1996. The dissolution orders provided that the couple's two children would reside a majority of the time with Cindy and set Gregg's monthly child support obligation at $1,000. This amount included Gregg's share of day care expenses. In 1997, Cindy moved to Alaska. In 1998, the parties entered into a modified agreed parenting plan and an agreed order adjusting child support. In that order, Gregg continued to pay $1,000 per month as child support, except that he was not required to pay support during the summer months when the children lived with him.
Prior action and appeal
In October 2000, Gregg filed a motion to adjust child support. However, he also requested reimbursement for day care overpayments under RCW 26.19.080(3). An order of child support was entered, which included an order reimbursing an overpayment of day care costs between April 1998 and September 2000. Besides the award for overpayment, the order set a transfer payment including an amount for child support and an amount equal to a percentage of `work-related' day care expenses. The award for overpayment included a sum for attorney fees. The order did not contain any findings of fact or reasons supporting the award. Cindy unsuccessfully moved for revision from the superior court. On appeal, after indicating that a lack of findings and conclusions hampered the decision, this court reversed the order awarding reimbursement and attorney fees, holding that Gregg's entitlement to reimbursement turned on the meaning of the agreed order, and the only reasonable interpretation of that order did not support reimbursement.
As a result of the opinion and the remaining underlying order, Gregg was ordered to pay $1,234.62 a month for 9 months of the year. The order included an amount for `work related' day care expenses for Gregg's two children, subject to monthly adjustment depending on the amount of day care expense actually incurred.
Current appeal
In May 2002, Cindy initiated an exchange of financial documents. Gregg was unemployed at the time and suggested the exchange wait until he was working. But in June 2002 he sent some financial documents to Cindy, and in July he brought a motion seeking, among other things, (1) to adjust the child support obligation, (2) to determine day care overpayment, and (3) to award Gregg reasonable fees and costs.
The facts and details of the proceedings below are well known to the parties and will not be restated. Ultimately, the trial court granted judgment to Gregg against Cindy for the overpayment of child care expenses in the amount of $3,322.53. The court also awarded Gregg $10,539.48 in attorney fees and costs. No findings of fact or conclusions of law regarding the necessity, or lack of necessity, of work-related day care expenses were made. The trial court made no finding of intransigence on Cindy's part. The trial court denied Cindy's motion for reconsideration. Fees and Costs awarded to Borg System Integrators, Inc. and Shirley Hynek Cindy claimed that both Gregg's mother and Gregg's former employer, Borg System Integrators, Inc. (Borg), withheld information affecting the calculation of child support. Cindy filed numerous motions to attempt to discover additional sources of income. The trial court denied the motions on September 5, 2002, and indicated that the third-party deponents Borg and Shirley Hynek were entitled to reasonable fees against Cindy, in an amount to be determined at a later date. Borg and Shirley Hynek argued they were entitled to these fees under CR 37(a)(4). Without making findings or conclusions, the trial court awarded them $10,515.60 in fees and costs, the sum sought by counsel. The order suspended $2,500 of this amount if Cindy refrained from seeking additional discovery in the future. Cindy appeals the various orders of the court.
Borg is an inactive corporation originally incorporated in 1999 by Shirley Hynek, Gregg's mother. She wholly owned the corporation and is listed as its only board member and officer. The corporation admittedly paid Gregg at some point before the 2000 adjustment of child support.
DECISION
An adjustment of child support under RCW 26.09.170(9) is limited in scope when compared to a full blown modification action under RCW 26.09.170(1). An adjustment simply conforms existing provisions of a child support order to the parties' current circumstances. But here, a simple adjustment action turned into a modification action when Gregg sought to have the court impute additional income to his ex-spouse and cut off his contribution to day care expenses.
Formerly RCW 26.09.170(8).
In re Marriage of Scanlon, 109 Wn. App. 167, 172-73, 34 P.3d 877 (2001).
Cindy alleges the trial court erred by failing to enter findings of fact and conclusions of law to support its orders. We agree. This court reviews child support modifications and adjustments for an abuse of discretion. Generally, this court will uphold a trial court's decision regarding child support unless there is a manifest abuse of discretion. But findings of fact are required in connection with all final decisions in divorce proceedings and for all orders of child support, including orders in support-modification proceedings. Trial court orders are reviewed by determining if the findings of fact are supported by substantial evidence or if the trial court made an error of law subject to correction on appeal. Here, no findings or conclusions were entered.
In re Marriage of Clarke, 112 Wn. App. 370, 375, 48 P.3d 1032 (2002) (citing In re Marriage of Griffin, 114 Wn.2d 772, 776, 791 P.2d 519 (1990)).
In re Marriage of Dewberry, 115 Wn. App. 351, 367, 62 P.3d 525, review denied, 150 Wn.2d 1006 (2003).
RCW 26.19.035(2); In re Marriage of Wayt, 63 Wn. App. 510, 512-13, 820 P.2d 519 (1991); In re Marriage of Brockopp, 78 Wn. App. 441, 446, 898 P.2d 849 (1995).
An order modifying support is generally reviewed to determine whether the factual findings are supported by substantial evidence and whether the order is erroneous as a matter of law. In re Marriage of Stern, 68 Wn. App. 922, 929, 846 P.2d 1387 (1993); In re Marriage of Shellenberger, 80 Wn. App. 71, 80-81, 906 P.2d 968 (1995).
Because we have no findings, we are not only unable to review critical rulings, but it is unclear just what the trial court based those rulings on, both factually and legally. Thus, on remand the trial court is free to review the basis for its rulings during the course of entering the appropriate findings and conclusions. To assist the trial court in that regard, we will set forth what we view as the applicable law given our understanding of the facts of this case.
Judgment for overpayment of day care expenses and resulting attorney fees Cindy contends the trial court abused its discretion in awarding judgment to Gregg for the overpayment of day care expenses and for awarding attorney fees. When a trial court makes an award of reimbursement, the record must set forth the method used to calculate the reimbursement award. As noted above, we hold that a remand for appropriate findings and conclusions is necessary.
In re Marriage of Knight, 75 Wn. App. 721, 729, 880 P.2d 71 (1994).
Specifically, when it is not clear on what ground the trial court entered its order, findings are required when reimbursement is ordered. See In re Marriage of Barber, 106 Wn. App. 390, 395, 23 P.3d 1106 (2001).
RCW 26.19.080(3) states that day care expenses are not included in the standard economic table for basic child support. But a trial court has discretion to order that necessary and reasonable expenses, such as day care, be shared in the proportion otherwise applicable to the child support order. In light of the overall legislative goal of preventing a harmful reduction in a child's standard of living, the terms `necessary and reasonable expenses' and `day care' are to be interpreted in a manner that serves the best interest of children.
RCW 26.19.020, 26.19.080(3), (4); In re Marriage of Mattson, 95 Wn. App. 592, 599, 976 P.2d 157 (1999) (citing In re Johnson-Skay, 81 Wn. App. 202, 204, 913 P.2d 834 (1996)).
Mattson, 95 Wn. App. at 599-600; see also RCW 26.09.002 ('In any proceeding between parents under this chapter, the best interests of the child shall be the standard by which the court determines and allocates the parties' parental responsibilities.').
RCW 26.19.080(3) also states that these expenses shall be shared by the parents in the same proportion as the basic child support obligation. Only if an obligor pays for day care expenses that are not actually incurred must an obligee reimburse those sums. But under RCW 26.19.080(4) these expenses are subject to the exercise of the trial court's discretion to determine the underlying necessity for, and the reasonableness of, all amounts ordered in excess of the basic child support obligation. In this case, there does not seem to be any dispute that a sum was paid for day care. What is in dispute is the amount spent and whether the expense was `work-related' as required by the previous orders of the court or agreement of the parties.
See Mattson, 95 Wn. App. at 599 (citing RCW 26.19.020, 26.19.080(3), (4) and In re Johnson-Skay, 81 Wn. App. 202, 204, 913 P.2d 834 (1996)).
There are few facts in the record to support the possibility that Cindy did not work nearly full-time or that day care was not work-related. See In re Marriage of Schumacher, 100 Wn. App. 208, 214-15, 997 P.2d 399 (2000) (full-time employment does not always mean forty hours a week). Argument to the contrary is mere conjecture. No court should give credence to Gregg's argument that day care is unnecessary because older school-age children in the household are available to watch his children, or that Cindy's new spouse could watch them at times.
As a result of the trial court's judgment for Gregg, attorney fees and costs were awarded to him in the amount of $10,539.48. But there are no findings of fact or conclusions of law supporting that award. Generally, the trial court must show that, in awarding those fees and costs, it balanced the parties' respective needs and ability to pay. Although the general rule of considering the financial resources of the parties does not always apply if the court finds that one party's actions constituted intransigence, the trial court did not make such a finding as to Cindy.
See RCW 26.09.140; In re Marriage of Wilson, 117 Wn. App. 40, 51, 68 P.3d 1121 (2003).
In re Marriage of Burrill, 113 Wn. App. 863, 873, 56 P.3d 993 (2002), review denied, 149 Wn.2d 1007 (2003).
Income figures
Of particular concern to this court is how the trial court determined the amount of the parties' income. Gregg argues the court adjusted Cindy's income upward by finding that she was voluntarily underemployed and by adding in the Alaska dividend. But due to a lack of findings this court does not know the underlying basis for the amount used to determine Cindy's income. It appears the trial court may have determined that Cindy was voluntarily underemployed. Although worksheets attached to an order may be determined to be findings, some of the figures entered on the worksheets in this case are neither supported by nor even found in the burdensome record of approximately 1,300 pages. Further, the trial court must be consistent in the way it figures the income for each party.
Attorney fees
RCW 26.09.140 allows a court to award reasonable attorney fees after considering the financial resources of both parties. But without findings and conclusions this court does not know if the trial court balanced the relative need and ability to pay of the parties, or considered the nature of the factual and legal questions involved, the amount of time necessary for preparation and presentation of the case, and the value and character of the property involved.
See Knight, 75 Wn. App. at 730.
Discovery motions and sanctions
Next, Cindy alleges the trial court erred in denying her discovery requests. This court reviews an order denying a motion to compel and other discovery requests for an abuse of discretion. Through discovery, Cindy attempted to establish that there was some conspiracy to defraud her and/or the court. She sought and received answers to a number of her requests from financial institutions and even from the now-defunct Borg. But counsel for Borg indicated that the corporation was no longer conducting business and had not been for two years. Whether Cindy caught Gregg in some sort of `untruth' about the use of a Mercedes automobile is of little value as she did receive notice that it was registered in Shirley Hynek's name. She received a printout of what the `disputed' $94,000 plus of deposits into Gregg's accounts were, although greater supporting documentation could have been forthcoming. Her request for income information for the people in Gregg's household, although discoverable under RCW 26.19.071, may not to be used to determine the amount of child support unless there is a deviation involved. Additionally, some of the information Cindy sought was based on faulty assumptions. For instance, her claim that Gregg must recognize gain/income on the refinancing of his home is not supported, because any gain is not recognized until sale.
Hertog v. City of Seattle, 88 Wn. App. 41, 47, 943 P.2d 1153 (1997), affirmed, 138 Wn.2d 265, 979 P.2d 400 (1999) (citing Barfield v. City of Seattle, 100 Wn.2d 878, 886-87, 676 P.2d 438 (1984)).
Gregg and his student-girlfriend lived in an apartment in his mother's home while he rented out his home, albeit allegedly at a loss.
Cindy claims that, based on the record, the trial court abused its discretion by awarding fees and costs to Gregg's mother, Shirley Hynek, and to her corporation, Borg Systems Integrators, Inc., Gregg's former employer. But again, without findings of fact and conclusions of law, the underlying basis for the trial court's award is unknown.
The trial court seemingly granted the fees as sanctions, likely pursuant to CR 37(a)(4). The question then becomes whether the court abused its discretion by awarding discovery sanctions. The appellate court reviews CR 37 discovery sanctions for abuse of discretion. CR 37 sanctions are permitted for unjustified resistance to discovery or unjustified actions seeking discovery. The sanctions serve to deter, punish, compensate, and educate a party or its attorney for engaging in discovery abuses. Discovery sanctions are discretionary.
It must be noted that third-parties, Borg and Shirley Hynek, are not entitled to fees under RCW 26.09.140 as argued in some of the briefing.
Washington State Physicians Ins. Exch. Ass'n v. Fisons Corp., 122 Wn.2d 299, 338-39, 858 P.2d 1054 (1993).
Johnson v. Mermis, 91 Wn. App. 127, 133, 955 P.2d 826 (1998).
Here, the argument is that Borg and Shirley Hynek are entitled to fees under CR 37(a)(4) because of Cindy's seemingly overzealous attempts to compel discovery and gain oral testimony, and her issuance of a number of subpoenas deuces tecum, especially in light of the responses Cindy and her counsel did receive. But the record is silent as to the trial court's reasons for denying the motion to compel discovery. The fact that the court imposed terms against appellant's counsel indicates the court found Cindy's motions were not legally justified. Thus, it may be that the court found the requests for discovery, including depositions, overly broad and burdensome. On remand the trial court may determine whether the discovery requests support the imposition of sanctions or not.
Attorney fees on appeal
Both parties seek attorney fees and costs on appeal. In exercising discretion under RCW 26.09.140, this court will consider the arguable merit of the issues on appeal and the financial resources of the respective parties. Where there is merit on both sides, the focus is on the parties' relative need and ability to pay, unless the court finds intransigence or that the appeal is frivolous. Gregg alleges fees should be awarded on the basis of need and because the appeal is frivolous. The appeal is not frivolous. Taking the above matters into consideration, on the basis of the record before this court, no fees will be granted on appeal.
CONCLUSION
The decision of the trial court is reversed and remanded for the entry of findings of fact and conclusions of law.
COLEMAN and APPELWICK, JJ., concur.