June 26, 2007
CAROLYN MERTZ, PLAINTIFF-APPELLANT,
LARRY R. MERTZ, DEFENDANT-RESPONDENT.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Gloucester County, Docket No. FM-08-638-94.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 30, 2007
Before Judges Skillman and Grall.
Plaintiff Carolyn Mertz and defendant Larry R. Mertz were divorced in December 1994. Plaintiff appeals from a post-judgment order entered on her motion to modify her obligations to pay child support and transport the children for parenting time, to enforce a prior order requiring defendant to contribute to the children's medical costs, and to recover counsel fees for the motion.
The parties married on April 6, 1989. They have two sons. The first was born in September 1991, and the second was born in October 1992. Pursuant to the parties' agreement, which was incorporated in their final judgment of divorce, their sons reside primarily with defendant and the parents share legal custody. Recognizing that plaintiff's employment as a registered nurse required her to work irregular hours, they agreed to a flexible schedule for parenting time.
Defendant waived child support for five years and plaintiff waived a cause of action pursuant to Tevis v. Tevis, 79 N.J. 422 (1979). She also agreed to provide health insurance for the children, pay for one-half of their medical expenses not covered by insurance, contribute $50 per week for services of a nanny and purchase their clothing.
In July 2000 the child support provisions of the final judgment were modified. Plaintiff was required to pay child support in the amount of $150 per week. Child support was calculated pursuant to the Child Support Guidelines, Pressler, Current N.J. Court Rules, Appendix IX-A to R. 5:6A at 2217-40 (2007). The calculation was based on the following: defendant's reported gross income of $335 per week, $17,240 per year, and plaintiff's gross income of $998 per week, $51,896 per year; twenty-six overnights per year for plaintiff; $35 per week for the children's health insurance premium, and $26 per week for work-related child care.
Plaintiff's share of the total child support amount was $252 per week, but defendant agreed to accept child support in the amount of $150 per week. The order requires plaintiff to secure the health insurance for the children, the cost of which was included in the guideline's amount so as to increase plaintiff's support obligation by $16 per week, or $69 per month.
That child support order also required the parties to divide medical expenses not covered by insurance, seventy-one percent to be paid by plaintiff and twenty-nine percent to be paid by defendant. That order consists of hand-written entries on a pre-printed form child support order. In the margin, just above the entry for the parties' respective share of actual medical expenses, there is a handwritten notation. That notation states, "$250 per yr. per child." It does not indicate whether the responsibility to pay "$250 per yr. per child" is allocated to plaintiff or defendant. The only box checked in that portion of the form is "obligor." Although plaintiff is the obligor, she contends that, consistent with the child support guidelines, defendant, as the custodial parent, had the obligation to pay the first $250 per year per child. See Pressler, supra, Appendix IX-A to R. 5:6A, "Considerations in the Use of Child Support Guidelines," ¶ 8 at 2223.
Subsequent to entry of that order, pursuant to N.J.S.A. 2A:17-56.9a and Rule 5:6-6, plaintiff's $150 per week child support obligation was adjusted in accordance with the cost of living and set at $167 per week.
Plaintiff filed her motion for modification of child support in March 2006. Defendant filed a cross-motion seeking an increase in child support.
The following facts are drawn from the certifications and documents submitted on the motion and cross-motion. In 2004 and 2005 the children spent more time with plaintiff than they had in the past. In 2004 they spent 119 nights in her home, and in 2005 they were with her 120 nights. Her gross earnings in 2005 were $71,026. Plaintiff asserted that defendant, who owns his own business and installs vinyl siding, earns more than he reported at the child support hearing in July 2000, which was $17,420 per year. She submitted wage statistics reported by the New Jersey Department of Labor and Workforce Development that reflected higher earnings for workers in her husband's field. She also contended that defendant's lifestyle and assets, as reflected on his case information statement and 2005 tax return, were indicative on earnings higher than his earning in 2000.
Defendant owns his own home and a $37,000 truck, which he uses in his business. There is no mortgage on his home, and he has no debt.*fn1 In 2005 his business income was $12,765 and his interest income was $2219. In addition, his parents give him $500 per month, a gift of $6000.
Plaintiff provided a summary of medical expenses she paid on behalf of the children, a total of $8147.75 between January 2000 and November 2005. Despite her prior requests for defendant to contribute his share, he did not. Plaintiff took no action to enforce defendant's obligation to contribute to medical expenses until this motion. She contended that defendant's share of the expense amounted to approximately $4000. That total was based, in part, on plaintiff's interpretation of the July 2000 order to require defendant to pay one hundred percent of the first $250 of each child's medical expenses every year since entry of the 2000 order.
In opposition to plaintiff's motion, defendant contended that over the years since their divorce, plaintiff had failed to comply fully with her obligation to purchase clothing for the children. He asserted that he would have attempted to enforce that obligation and moved for an increase in child support if she had filed an enforcement motion.
Plaintiff submitted a certification of services reflecting fees and costs rendered in connection with this motion up to the date of filing in the amount of $2280. There is no indication that defendant submitted a certification of services.
The judge ordered defendant to pay plaintiff $1000 for medical expenses. Considering plaintiff's delay in taking action to enforce defendant's obligation to contribute and recognizing that defendant could have responded to a timely enforcement motion by seeking a modification of support and enforcement of plaintiff's obligation to purchase clothing, the judge concluded that it would be inequitable to allow plaintiff to seek reimbursement for medical expenses she had paid long ago. The judge concluded that the equitable doctrine of laches applied and, on that basis, awarded plaintiff one-quarter of the amount sought.
Child support was calculated pursuant to the guidelines. Although the child support guidelines worksheet is not appended to the order as required by Rule 5:6A, the record reflects that the judge based the calculation on plaintiff's earnings in 2005, $71,000, and imputed earned income to defendant in the amount of $700 per week. The judge did not explain how he determined that it was appropriate to impute $700 and did not explain why he excluded the unearned income that defendant reported -- interest in excess of $2000 per year and $6000 per year given to him by his parents in $500 monthly installments. The judge simply explained that it was his "sense" that the difference would not be "significant."
The child support calculated on the basis of the foregoing information called for an increase in plaintiff's obligation, but defendant withdrew his request for modification. As a consequence, the judge did not modify the order. The order does not reflect the judge's ruling on plaintiff's motion to reduce support or explain the judge's reasons for accepting defendant's agreement to accept child support lower than the guidelines amount. See R. 5:6A (authorizing deviation for good cause and requiring an explanation of the reasons for any deviation).
The judge concluded that plaintiff failed to demonstrate grounds for modification of her obligation to transport the children for parenting time as set forth in the final judgment.
He encouraged defendant to cooperate with plaintiff and assist with transportation when he could.
The judge awarded plaintiff counsel fees in the amount of $500. That determination was based on the judge's evaluation of the reasonableness of the positions asserted, the fact that plaintiff sought to enforce defendant's obligation to pay medical expenses and her partial success on that issue.
Plaintiff raises the following issues on appeal:
I. The Trial Judge's finding and legal conclusion that laches should apply to part of plaintiff's claim for reimbursement of defendant's share of unreimbursed medical expenses related to the parties' two sons from 2000 -2005, was an abuse of discretion, requiring reversal.
II. The Trial Judge's decision to deny modification of the transportation plan related to the children was an abuse of discretion.
III. The Trial Judge erred by failing to address plaintiff's claim for modification of child support based on changed circumstances.
IV. The Trial Judge's decision to impute income of $36,400 to [d]efendant was an abuse of discretion and/or arbitrary and capricious.
V. The Trial Court's calculation of what child support was owed was an abuse of discretion and clearly erroneous.
VI. The Trial Judge's decision to only award Plaintiff $500.00 in attorney fees was an abuse of discretion.
After considering the record in light of the arguments presented, we conclude that the issues raised in Points I, II and VI lack sufficient merit to warrant more than brief comment in a written opinion. R. 2:11-3(e)(1)(E). The judge's ruling on medical expenses, transportation and counsel fees are consistent with controlling legal principles, supported by the record and not a product of an abuse of discretion.
Laches is an equitable doctrine invoked to preclude delayed enforcement of a claim when the delay is prejudicial to the party against whom the claim is asserted. See L.V. v. R.S., 347 N.J. Super. 33, 39 (App. Div. 2002). "[T]he central issue is whether it is inequitable to permit the claim to be enforced [and] generally the change in condition or relations of the parties coupled with the passage of time [is] the primary determinant. . . ." Lavin v. Bd. of Educ. of City of Hackensack, 90 N.J. 145, 152-53 (1982). Inequity is generally found where a party has been misled and harmed by the delay.
Id. at 153. The judge did not err in applying that doctrine under the circumstances of this case. The meaning of the July 2000 order incorporating the parties' agreement for payment of reduced child support was far from clear, and the potential for real prejudice to defendant inherent in a delayed attempt to enforce the order was apparent.
Plaintiff agreed to provide all transportation for parenting time at the time of the final judgment of divorce. The judge's determination that plaintiff's increased parenting time and the increasing cost of gasoline were insufficient to warrant modification of the agreement is supported by the record. Changes in the frequency of visitation and distance involved, rather than the duration of each visitation, were relevant to the burden imposed by this parental obligation, and the question of cost is relevant to child support. Plaintiff's claim, to the extent tied to the facts, was based primarily on the total number of days the children spent with her.
The award of counsel fees to litigants in the Family Part is left to the sound exercise of the judge's discretion in accordance with the factors enumerated in Rule 5:3-5(c). See Chestone v. Chestone, 322 N.J. Super. 250, 256 (App. Div. 1999); N.J.S.A. 2A:34-23. The litigants' relative financial position, good faith and success in enforcing prior orders are among the relevant factors. R. 5:5-3(c). The judge considered those factors and there is no clear abuse of discretion warranting interference by this court.
Points III, IV and V of plaintiff's brief address the court's denial of plaintiff's motion to modify child support.*fn2 Because plaintiff's motion was not adjudicated in accordance with the court rules and judicial precedents governing child support, we reverse and remand.
A party seeking modification of his or her child support obligation has the burden of demonstrating a change in circumstances warranting an adjustment. Lepis v. Lepis, 83 N.J. 139, 158 (1980). Where that showing is made, discovery is warranted and a hearing to resolve material factual disputes is required. Id. at 158-59. The decision must be made in accordance with the child support guidelines and the best interests of the children. See Caplan v. Caplan, 182 N.J. 250, 266 (2005); Terry v. Terry, 270 N.J. Super. 105, 121 (App. Div. 1994); Zazzo v. Zazzo, 245 N.J. Super. 124, 129 (App. Div. 1990), certif. denied, 126 N.J. 321 (1991). The trial court's discretion in determining the amount of child support is limited by the foregoing principles and the child support guidelines, which are designed to result in a fair allocation of the parental responsibility to provide the support for the children that is appropriate given the parents' resources. See Caplan, supra, 182 N.J. at 267-68, 271.
A demonstration of a significant change in a circumstance pertinent to the guidelines calculation and having a substantial impact on support is sufficient to establish a prima facie case for modification. Parenting time is a factor that impacts the amount of child support, and a significant change in parenting time may have a significant effect on child support. Where parenting time is adequate a court must consider whether it is appropriate to calculate child support using the "shared-parenting" worksheet; use of that worksheet increases the basic support amount in recognition of the additional cost parents incur when they provide two homes for their children. See Pressler, supra, Appendix IX-A to R. 5:6A, "Considerations in the Use of Child Support Guidelines," ¶¶ 13-14 at 2227-34. Plaintiff established a prima facie case for modification based on a significant change in parenting time.
In addition to a change in parenting time, the evidence submitted on the motion and cross-motion demonstrated a substantial increase in plaintiff's income since 2000 and raised a serious question about whether the income defendant reported reflected his actual income and capacity to earn. Plaintiff supplied wage statistics that showed a significant discrepancy between defendant's earnings and average earnings of persons in his line of work. The legitimacy of the question was demonstrated by defendant's tax return and case information statement, which reflected significant interest income and ownership of a home, free of a mortgage, and an expensive vehicle. That discrepancy was sufficient to warrant initial discovery and a hearing to resolve any factual disputes not resolved by the production of additional information. Lepis, supra, 83 N.J. at 158-59. Given the disputed issues of material fact, it was error to address the merits of the motion and cross-motion on the basis of the papers submitted.
There was additional error. The guidelines provide for parents to share the expenses of their children "in proportion to their relative incomes and . . . based on [their] combined net income . . . ." Caplan, supra, 182 N.J. at 264. Net income is gross income minus income taxes and certain mandatory payroll deductions. Ibid. Gross income includes "unearned income that is recurring or will increase the income available to the recipient over an extended period of time." Id. at 265 (quoting Pressler, supra, Appendix IX-B to R. 5:6A at 2532 (2005)). The judge's reason for excluding defendant's interest income and recurring monthly income from gifts is wholly inadequate to warrant deviation from the guidelines definition of income. Good cause is required. R. 5:6A.
The statement of findings and reasons relevant to imputation of income to defendant is also inadequate. There is no explanation as to why the court determined that defendant is underemployed and no explanation as to how the court selected $700 per week as the appropriate amount of income to impute to him. We need not repeat here the guidance on imputation of income for purposes of child support that is provided in Caplan, supra, 182 N.J. at 265-70, in cases cited in Caplan, and in this court's recent decision in Larrison v. Larrison, 392 N.J. Super. 1, 19-21 (App. Div. 2007) (discussing imputation and child care responsibilities). As those cases make clear, the question of imputation must be addressed on an adequate record and in accordance with the guidelines and those decisions.
Finally, we note that the order does not include, as an attachment, the child support guidelines calculations upon which the court based its decision to deny plaintiff's motion, which is required by Rule 5:6A. In this case, the judge concluded that defendant was entitled to more support than he was receiving but accepted defendant's offer to withdraw his request for additional child support. Upon making that determination, the judge was required to provide the guidelines worksheet and a statement of the reasons for continuing an order that deviated from the guidelines amount. R. 5:6A; see Ordukaya v. Brown, 357 N.J. Super. 231, 241 (App. Div. 2003) (discussing parental agreements to deviate from the guidelines and emphasizing that a waiver of child support must be consistent with the interest of the children who are the beneficiaries of the support).
With the exception of the denial of plaintiff's motion to modify support, which is reversed and remanded for further proceedings in accordance with this decision, the order is affirmed.