Opinion
No. A04-1664.
Filed May 24, 2005.
Appeal from the District Court, Douglas County, File No. FX-98-13.
Ann L. Carrott, (for respondent)
Jeffrey L. Loftness, Kristine Anderson Isle, Loftness Anderson, P.A., (for appellant)
Christopher Karpan, Douglas County Attorney, Daniel C. Lee, Assistant County Attorney, (respondent intervenor)
Considered and decided by Dietzen, Presiding Judge; Shumaker, Judge; and Huspeni, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2004).
UNPUBLISHED OPINION
Following emancipation of the second of the parties' three children, a child support magistrate used the Hortis/Valento formula to calculate child support for the remaining minor child. Respondent sought review of the magistrate's order and the district court reversed, concluding that support was to be determined by applying the support guidelines, thus recognizing the split-custody and child-support arrangement that had been observed by the parties at all times after the dissolution of their marriage. Because the district court properly determined that child support was to be calculated according to support guidelines and not according to the Hortis/Valento formula, we affirm.
FACTS
Appellant Donald Kleine and respondent Jeanne Kleine, n/k/a Jeanne Kramer, dissolved their marriage in September 1998. Three children were born during the marriage: M, in 1982; C, in 1985; and J, in 1992. The dissolution decree included the following description of the parties' stipulated custody arrangement:
The parties agree that it is in the best interests of their minor children that the parties be awarded joint legal custody of their minor children. The parties further agree that it is in the best interests of their minor children that the parties be awarded joint physical custody of their minor children but that the actual physical custody and primary parenting of the children remain as stipulated by the parties in the Temporary Stipulation, that is, [respondent] be awarded actual physical custody and primary parenting of [J] and [appellant] be awarded actual physical custody and primary parenting of [M] and [C].
The parties agree that actual physical custody and primary parenting means that the party awarded actual physical custody and primary parenting of a child or children is the custodian of that child or children and shall make all day-to-day decisions regarding that child or children, including, but not limited to, the school the child or children shall attend, the child care provider, the church the child or children shall attend and the health care providers for the child or children, not withstanding the provisions of joint legal custody.
The parties were unable to stipulate as to child support and agreed to submit that issue to the district court. Child support was subsequently established by the district court based upon the statutory guidelines; neither party objected to either the amount of support each was to pay to the other nor to the formula upon which support was based. The order now before this court on appeal makes the following reference to the original support order issued in 1998:
The calculations done by the Court provided for support pursuant to the guidelines with appropriate setoffs and did not take into account the time each parent spent with the children. Although the Judgment and Decree provided for joint physical custody, the Hortis/Valento formula was not applied. . . .
It is undisputed that under the 1998 child-support order appellant was to pay guideline support to respondent for J, and respondent was to pay guideline support to appellant for M and C. Setoffs of the two obligations were anticipated in the 1998 order, but those setoffs involved calculations according to the guidelines, not according to the Hortis/Valento formula.
See Schlichting v. Paulus, 632 N.W.2d 790, 792 (Minn. App. 2001) (addressing application of Hortis/Valento as guideline support modified by offset of percentage of time spent with each parent).
At the time M became emancipated, the motion of intervenor Douglas County to modify the parties' child-support obligations was granted, resulting in each parent paying guidelines support for the child residing with the other parent. This continuation of guidelines' support from each parent to the other (and the resulting setoff) was the formula set forth in Sefkow v. Sefkow, 427 N.W.2d 203, 217 (Minn. 1988) (setting child support based on split custody as the net payment resulting from the offset between guideline payments by each parent).
Not surprisingly, the emancipation of C gave rise to the issue now before us. When Douglas County once again moved for modification, the child support magistrate (CSM) applied the Hortis/Valento formula, not the Sefkow formula that had been used previously. The CSM determined that J resided with respondent approximately 65% of the time and appellant approximately 35% of the time and calculated appellant's child-support obligation using Hortis/Valento accordingly. Appellant's child-support obligation for J was set at $172 per month.
Respondent sought review by the district court of the CSM's order, contending that the Hortis/Valento formula had never been applied previously and was inapplicable in establishing child support for J. The district court agreed and reversed the CSM, finding that
the "joint physical custody" label . . . was only a label and was not used by the Court in establishing child support[,] . . . was not considered when the support was modified after the first child graduated from high school, and . . . was ignored by the parties when handling children's issues as the children were growing up. . . . [T]his was a sole physical custody arrangement from the beginning and continues to be.
The district court ordered appellant to pay $658.32 per month based on his guideline obligation for J. Appellant challenges the district court's order.
DECISION
A district court has broad discretion to provide support for the parties' children. See Putz v. Putz, 645 N.W.2d 343, 347 (Minn. 2002). A district court abuses its discretion when it sets support in a manner that is against logic and the facts on record or misapplies the law. Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984); Ver Kuilen v. Ver Kuilen, 578 N.W.2d 790, 792 (Minn.App. 1998).
We note initially that this case raises once more the thorny issue of "labels" and the effect that custody designations have upon resulting child-support obligations. As noted by this court in Nolte v. Mehrens, "[I]dentifying whether the parties have joint physical custody or whether one party has sole physical custody is critical to setting the parties' support obligations." 648 N.W.2d 727, 730 (Minn.App. 2002). Unquestionably, much of the controversy that results from "labeling" custody and subsequently applying that "label" in establishing the parties' child-support obligations can be avoided when the parties are able to stipulate as to both issues (or, arguably, even when the court is called upon to decide both issues). But when, as in this case, a stipulation is reached as to custody but not as to support, conflation and conflict may ensue.
It is uncontested that from 1998 through the emancipation of C in 2003, each party was responsible for paying guideline support to the other for the child or children in that other's care (subject, of course, to the Sefkow formula setoffs). There was no complaint, much less any formal appeal, by either party in connection with those obligations. When C became emancipated, J was the sole remaining minor child. Appellant argues in effect that even though the "split-custody" formula of Sefkow may have been tolerable when there were enough minor children in existence to make that formula a reality, now that there is but one minor child, split custody is a misnomer and both parties should share her support on the percentage basis set forth in the Hortis/Valento formula.
Under Hortis/Valento, separate support obligations are set forth for each parent based on the periods of time that the other parent has physical custody of a child, and a net payment is determined by offsetting the two obligations against each other. Schlichting, 632 N.W.2d at 792.
We recognize that application of the Hortis/Valento formula is presumptively correct in response to a designation of "joint physical custody" of the parties' children. Bender v. Bender, 671 N.W.2d 602, 608 (Minn.App. 2003). But that presumption can be overcome by sufficient written findings made by the district court. Minn. Stat. § 518.551, subd. 5(i) (2004); Schlichting, 632 N.W.2d at 793. Written findings made by the district courts here — both in 1998 and in the order presently on appeal — have overcome any presumption that may have been raised by the custody language of the decree.
The Nolte court implicitly addressed the problem that is present here in its cogent observation that
when parents stipulate to a physical-custody arrangement and the district court adopts that arrangement, the dispositive factor in determining whether the arrangement establishes sole physical custody for one parent or joint physical custody for both parents, and therefore whether it is presumptively appropriate to apply the Hortis/Valento child support formula, is the district court's description of the physical-custody arrangement.
Nolte, 648 N.W.2d at 730.
Here, in the dissolution decree, the parties stipulated that they would share "joint physical custody" of the three children with "actual physical custody" of two children with appellant and one child with respondent. Had the parties been able to interpret and apply the custody language to the inevitable issue of child support, there is a considerable likelihood that the present litigation could have been avoided. Unfortunately, the parties could not agree about support, and the district court undertook to establish the child-support obligation of each party. Thus, while the use of the term "joint physical custody" in the original order may, indeed, have created a presumption that the Hortis/Valento formula was applicable, the district court in its original dissolution decree sufficiently rebutted that presumption by (1) defining "actual physical custody" in terms indicative of a split-custody arrangement, and (2) declining to apply Hortis/Valento and instead applying the offset guideline Sefkow formula applicable to a split-custody arrangement.
The parties accepted and complied with the 1998 support order under which each party paid guidelines support to the other for the children in that other's care. It is only at present, when there is but one remaining minor child — a child whom appellant recognized as deserving of support from him pursuant to the guidelines while he was also able to take advantage of and profit by the setoff he received because respondent was paying guidelines support to him for one or two children in his care — that appellant insists that it is the Hortis/Valento formula that must be applied. We disagree. In 1998, the district court set child support after determining that the custody arrangement was, in fact, one in which each party had sole physical custody of one or two of the minor children. The parties' compliance with that determination throughout the years gives credibility to that determination and establishes a history that is impossible to disregard. See Allan v. Allan, 509 N.W.2d 593, 596 (Minn.App. 1993) (refusing to treat modification of formula used to calculate support different from modification of support obligation itself).
A point noted earlier bears repetition and expansion. It is critical, when custody specifications are set forth in orders or decrees, whether by stipulation of the parties or order of the court, that recognition and identification of each party's support obligation also be set forth with specificity. Labels that may appear to express clearly the desires of the parties or the intentions of the court regarding custody may create, in the context of establishing child support, the emotional and financial adverse consequences for parties and children alike that are not only unacceptable, but intolerable as well.
An example of the conflation of the concepts of child support and child custody is illustrated by appellant's citation of Ayers v. Ayers, 508 N.W.2d 515 (Minn. 1993), to support his argument that the Hortis/Valento formula must be applied here. The issue in Ayers was custody, not support. Id. at 518. Further, contrary to appellant's arguments that the order now being appealed actually modifies custody, it is clear that the order merely interprets the custody arrangement set forth in the dissolution decree, and in the child-support order that was subsequently issued by the district court in 1998.
The district court appropriately applied the offset guideline Sefkow formula to appellant's current child-support obligation for J.