Anita Marie Peck, petitioner, Respondent, vs. Richard Mohr Peck, Jr., Appellant.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2002).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

C2-03-116

 

Anita Marie Peck, petitioner,

Respondent,

 

vs.

 

Richard Mohr Peck, Jr.,

Appellant.

 

Filed ­­­August 12, 2003

Affirmed; motion denied

Harten, Judge

 

Hennepin County District Court

File No. DC261479

 

Edward L. Winer, Ben M. Henschel, Moss & Barnett, P.A., 4800 Wells Fargo Plaza, 90 South Seventh Street, Minneapolis, MN 55402 (for appellant)

 

Martin L. Swaden, Swaden Law Office, 7301 Ohms Lane, Suite 550, Edina, MN 55439 (for respondent)

 

            Considered and decided by Harten, Presiding Judge, Stoneburner, Judge, and Minge, Judge.

U N P U B L I S H E D   O P I N I O N

 

HARTEN, Judge

 

            Appellant obligor challenges his temporary spousal maintenance and child support obligations.  Because we see no abuse of discretion in the temporary spousal maintenance award and no error in the calculation of appellant's net monthly income for child support purposes, we affirm.

FACTS

            Appellant Richard Peck and respondent Anita Peck were married in 1983; their three children are now ages 17, 15, and 13.  During the first years of the marriage, respondent did not work for pay.  Then, at appellant's suggestion, she began working out of the parties' home as a sole proprietor, called Image Express, which provided document scanning and indexing services to TCF National Bank (TCF).  Appellant's company, Image Express, Inc., provided photo retrieval services for TCF.  TCF remained respondent's principal client.

The parties' marriage was dissolved in 2001, and they received joint legal and physical custody of their children. At that time, appellant's net monthly income was $4,691 and respondent's was $5,586.  The judgment reserved the issues of child support and maintenance and provided that each party would continue to pay the agreed $500 monthly into an account from which the children's expenses would be paid. 

            In 2002, appellant underbid respondent to TCF with the result that TCF cancelled respondent's contract as of 30 August 2002.  Respondent's net monthly income fell to $2,511, and she moved for spousal maintenance and child support. The district court awarded her $1,000 monthly in temporary spousal maintenance from October 2002 until September 2003 and, applying the Hortis-Valento formula to the parties' joint physical custody of the children, calculated appellant's child support obligation at $382 monthly. Appellant challenges these awards.[1]

D E C I S I O N

 

            The district court has broad discretion both in awarding spousal maintenance and in providing for the support of the parties' children. Rutten v. Rutten, 347 N.W.2d 47, 50 (Minn. 1984).  This court will not reverse absent an abuse of that discretion.  Id. [2]

            Appellant challenges both the temporary spousal maintenance award and the child support obligation by arguing that respondent is voluntarily underemployed and that the district court erred in not imputing income to her.  See Minn. Stat. § 518.551, subd. 5b(d) (2002) (imputing income to voluntarily underemployed parents for child support purposes).  The district court found that:

                        The parties are in the unfortunate situation of competing against one another in business. * * * They both do provide essentially the same service, scanning and indexing documents.

           

* * * [Respondent] lost [the TCF business] because [appellant] gave TCF a lower bid, which they accepted and terminated her contract * * *.  [Appellant] drafted the original contract for TCF and dealt with them directly.

 

            * * * [Appellant] asserts that [respondent] should be able to obtain another contract as a substitute for the lost TCF contract. * * * [Respondent] credibly asserts that she does not have the type of salesperson personality to search for new business; [appellant] not credibly asserts that a "sales" personality is not necessary, since all she has to do is work on image and scanning documents.  [But respondent] * * * will have to either find substitute contracts or other suitable employment.  She does not have a college degree and her work history for the last twenty years has been working at this type of business out of her home. * * *

 

* * * *

 

* * * There is no indication that [respondent] has acted in bad faith or is in any manner self-limiting her income. 

 

Appellant argues that respondent could replace the TCF business with other clients.  But when respondent asked him for help by providing names of companies that used compatible software, he replied, "[I]t is our policy not to provide sales leads to our competitors."  Appellant claims that respondent "has not read the software manual and does not know the software's full capability," but this argument supports respondent's position that she is unfamiliar with the large-scale operation of the business and is not able to generate business on her own.[3]  The district court's finding that respondent's underemployment is not voluntary but is due at least in part to appellant's competitiveness is well supported by the evidence.  The district court did not err in declining to impute income to respondent for either child support purposes or maintenance purposes.

In regard to temporary spousal maintenance, appellant also argues that the district court failed to consider the improvement in respondent's financial situation resulting from her  "meretricious relationship" and to make a finding on her living expenses.  These arguments are without merit: the district court found that "[respondent's] boyfriend buying her dinner, paying for movie tickets, or even letting her use his car is marginally relevantat best" and adopted each party's claimed living expenses.

            Moreover, as the district court found, "the gist of this case concerns [respondent's] lost business and corresponding decrease in income" and "[respondent] needs rehabilitative spousal maintenance on the account of her business loss due to [appellant's] action [in] underbidding her * * * ."  Her monthly income fell to $2,511; her expenses remained about $6,200.  The district court did not abuse its discretion in awarding rehabilitative maintenance of $1,000 monthly for a year.

            In regard to child support, appellant argues that the district court erred in failing to deduct his $1,000 monthly temporary spousal maintenance obligation from his income, reducing it during the year that the maintenance order was in effect from $4,691 to $3,691.  But

subtracting contemporaneously ordered maintenance in the process of determining the obligor's net income available for child support is an error in the application of Minn. Stat. § 518.551, subd. 5.

 

Driscoll v. Driscoll, 414 N.W.2d 441, 446 (Minn. App. 1987).  The district court correctly calculated appellant's net income for child support purposes.

Respondent has moved for attorney fees on appeal.  Given appellant's substantial indebtedness to his own attorney, we decline to award respondent appellate attorney fees.  See Minn. Stat. § 518.14, subd. 1 (2002) (one requirement for an award of need-based attorney fees is the ability to pay of the party against whom fees are awarded).

            Affirmed; motion denied.

 

[1] The district court ordered appellant to comply with discovery requests.  It appears that appellant has done so but nevertheless seeks reversal of the order.  His compliance with the order renders the issue moot.

[2] Appellant argues that the district court modified child support; respondent argues that it set child support after a reservation.  It is undisputed that child support was reserved in the judgment.  Setting support after a reservation is not a modification.  Mulroy v. Mulroy, 354 N.W.2d 66, 69 (Minn. App. 1984).  In any event, respondent's loss of income meets the "substantial change in circumstances" test for a modification.  See Minn. Stat. § 518.64, subd. 2 (2002).  Appellant also argues that he should not have to pay both guideline child support and the monthly $500 to the children's expenses account. However, respondent also pays $500 to that account, and both parties figured the $500 into their net monthly calculations.  Accordingly, if appellant seeks to modify the judgment by eliminating the parties' $500 payments, he will have to proceed by motion in the district court.

[3] Appellant also argues that the district court erred in finding that respondent's Kodak software is compatible only for other users of that same software.  An affidavit from a Kodak sales representative supports appellant's argument.  But that argument is counterproductive: respondent's admitted lack of sophistication in her business supports the district court's finding that she is not voluntarily underemployed.