Greg Reynolds Sims v. Virginia Ann Sims

ca05-610

ARKANSAS COURT OF APPEALS
NOT DESIGNATED FOR PUBLICATION

GREG REYNOLDS SIMS

APPELLANT

V.

VIRGINIA ANN SIMS

APPELLEE

CA05-610

January 18, 2006

APPEAL FROM THE JOHNSON COUNTY CIRCUIT COURT

[NO. DR-2004-313]

HON. GORDON W. "MACK" MCCAIN JR., JUDGE

AFFIRMED

Sam Bird, Judge

Appellant Greg Sims appeals the decision of the Johnson County Circuit Court requiring him to pay child support for his minor child, Will Robinson Sims. Appellant argues that the trial court erred because (1) there had been no change in circumstances to justify the trial court's decision; and (2) even if there had been a change in circumstances, the trial court incorrectly set the amount of child support in violation of Supreme Court Administrative Order No. 10. We disagree; thus, we affirm.

We review equity cases de novo, but will only reverse if the trial court's findings were clearly erroneous or clearly against the preponderance of the evidence. Ford v. Ford, 347 Ark. 485, 65 S.W.3d 432 (2002). A finding is clearly erroneous when the reviewing court, on the entire evidence, is left with the definite and firm conviction that a mistake has been committed. Id. We give due deference to the trial judge's superior position to determine the credibility of the witnesses and the weight to be given their testimony. Id.

Appellant and appellee Virginia Ann Sims were married on August 8, 1992, and were divorced by a decree entered on January 30, 2004. Two children were born of the marriage: Arthur Gregory Sims ("Art") and Will Robinson Sims. Pursuant to the divorce decree, Ms. Sims was granted custody of Will and Mr. Sims was granted custody of Art. The decree also provided that Mr. Sims would pay Ms. Sims $1,000 per month in alimony, but it said nothing about child support or visitation.

On July 28, 2004, Ms. Sims filed a petition requesting that she be awarded custody of both children and that Mr. Sims be ordered to pay child support. Mr. Sims subsequently filed a motion seeking custody of the children. A hearing was held on January 26, 2005.

At the hearing, Ms. Sims testified that Mr. Sims verbally agreed to pay "$500 a month ... or to provide anything that [Will] may need." Specifically, she said that the agreement was that Mr. Sims would pay $500 per month until Will was eighteen, which would cover "whatever Will needed as far as clothes, food, and any extracurricular activities." Ms. Sims said that she received child-support payments from Mr. Sims for the months of January, February, March, April, and May of 2003. Thereafter, she received child-support payments "off and on." She claimed that Mr. Sims would write separate checks for alimony and for child support. She also testified that her take-home pay was $1,800 per month and that she did not have any other income except the $1,000 per month in alimony. She said that there were no provisions for child support in the property settlement agreement after the divorce because she did not have an attorney, and that Mr. Sims told her that she did not need one.

Mr. Sims testified that he had been an insurance agent at Farm Bureau since September 1992 and that he was treated as "self-employed." He said that his earnings were based on commission and that, based on his income tax returns for the years 2001, 2002, and 2003, his income on commissions was "$70,000 a year or less." According to his testimony, in 2004 this income was approximately $72,000. He said that he "supposedly" had income from other sources, including a tobacco store, from which he received $830 per month, a Subway shop that he rented out for $1,250 per month, and other property that he rented out for approximately $2,600 per month. He claimed that he was losing money on the tobacco store. He introduced evidence that his gross income for 2004, based on his insurance commission statements, was $72,373.09.

Mr. Sims admitted that he had paid Ms. Sims $500 per month in child support and that he had written separate checks each time-one check for alimony and one check for child support. He said it was "to help [Ms. Sims] along for expenses for her and the children" and, specifically, "to help Will." He said that he did not tell her that she did not need an attorney.

Mr. Sims filed bankruptcy after the divorce. He said that he had "far greater income" than Ms. Sims, his being around $6,000 per month and hers being approximately $1,800 per month. He testified that, since the divorce, he had purchased a Hummer and two motorcycles, and that he had no bankruptcy plan in place at the time of the hearing. He admitted that at some point before the divorce decree was entered, he agreed to pay Ms. Sims "some money."

Mr. Sims said that, at the time of the divorce, only one of his rental properties was rented out and that he had a "large deficit." He said that he stopped sending money to Ms. Sims because "she was pursuing all of this and telling me how much child support I was in the hole." He said that he "guessed she thought they had a child support agreement because she did not believe [he] could stop paying" and that he was "paying it out of the goodness of [his] heart and she was griping about it continuously." He also said that he "just decided that [Will] did not need anything so [he] was just not going to pay it anymore." In addition, he testified that he "couldn't afford it."

In a letter ruling dated February 16, 2005, the trial court granted Mr. Sims's motion to dismiss his petition for a change in custody and denied Ms. Sims's petition for a change in custody, but ordered Mr. Sims to pay child support, finding in part as follows:

The Court finds from the testimony of the parties and the evidence of past child support payments by the Plaintiff [Mr. Sims] to Defendant [Ms. Sims] that the parties contemplated and agreed to the payment of support to the Defendant for the minor child Will Robinson Sims. In determining the existence of an agreement regarding support, the Court relies on, a) the assertion by Defendant in her pleadings, b) the credibility of Defendant's testimony regarding the existence of an agreement to pay support, c) the testimony of the Plaintiff confirming that payments were made to Defendant and the payments were "to help the Defendant along," and to help the child "Will"... d) the statement by the Plaintiff that the payments were made on a regular basis separate from and in addition to the monthly alimony payments, e) the statement by the Plaintiff that the Defendant thought there was a child support agreement, and f) ... the amount paid by Plaintiff is consistent with the Court's calculating of monthly support as set out below. Plaintiff's failure to continue the payments to Defendant represents substantial changed circumstances which directly [affects] the day-to-day life of the child Will Robinson Sims. ... Testimony indicated Plaintiff's gross income for 2004 was $72,373.09, and that this income was primarily attributable to his insurance business and did not consider his other business interests or property income. Testimony indicated the Defendant's gross income was $28,687.84, a difference of $43,685.25. Assuming a tax bracket of 15% (as set out in the letter briefs of both parties) for Plaintiff, the net income for Plaintiff would be $37,132.47, resulting in a monthly support obligation of $542.00 to be paid to Defendant for the support of the child Will Robinson Sims.

Change in Circumstances

Mr. Sims first argues that there was no change in circumstances to justify the trial court's decision in this case. A change in circumstances must be shown before a court can modify an order regarding child support, and the party seeking modification has the burden of showing a change in circumstances. Roland v. Roland, 43 Ark. App. 60, 859 S.W.2d 654 (1993). A trial court's determination as to whether there are sufficient changed circumstances to warrant an increase in child support is a finding of fact, and this finding will not be reversed unless it is clearly erroneous. Id.

We hold that the trial court's finding that there was a change in circumstances sufficient to warrant a modification of Mr. Sims's child-support obligation was not clearly erroneous. Mr. Sims admitted that he made $500-per-month child-support payments to Ms. Sims following the divorce and that he stopped paying because he "just decided that [Will] did not need anything so [he] was just not going to pay it anymore." Though Mr. Sims argues that, pursuant to the divorce decree, neither party was required to pay child support to the other, that his child-support payments since the time of the decree were "voluntary," and that essentially there had been no change since the decree was entered, we disagree.

In the context of divorce litigation, while parties may enter into contractual agreements with regard to contributions for child support, it is settled law in this state that the duty of child support cannot be bartered away permanently to the detriment of the child. Warren v. Kordsmeier, 56 Ark. App. 52, 938 S.W.2d 237 (1997). Regardless of what an independent contract states, a trial judge has the authority to modify an agreement for child support to meet changed conditions. Id. Here, a change clearly occurred when Mr. Sims stopped paying child support for Will; thus, we cannot say that the trial court's ruling that there were sufficient changed circumstances to warrant a modification of Mr. Sims's child-support obligation was clearly erroneous.

Supreme Court Administrative Order No. 10

Mr. Sims next argues that, even if circumstances had changed, the trial court incorrectly set the amount of child support in violation of Arkansas Supreme Court Administrative Order No. 10. He specifically asserts that, as a self-employed person, his child-support obligation should have been based on his last two years' income as reflected by his tax returns. He also claims that Ms. Sims only presented evidence of his gross income in the previous year and did not introduce his tax returns, even though they were provided to her during discovery.

As Mr. Sims points out, Supreme Court Administrative Order No. 10 defines "income" as follows:

Income means any form of payment, periodic or otherwise, due to an individual, regardless of source, including wages, salaries, commissions, bonuses, workers' compensation, disability, payments pursuant to a pension or retirement program, and interest less proper deductions for:

1. Federal and state income tax;

2. Withholding for Social Security (FICA), Medicare, and railroad retirement;

3. Medical insurance paid for dependent children; and

4. Presently paid support for other dependents by court order.

Mr. Sims argues that, pursuant to Administrative Order No. 10 and its provisions for self-employed payors, the trial court should have calculated support based on his last two years' federal and state income tax returns. He cites Cole v. Cole, ___ Ark. App. ___, ___ S.W.3d ___ (Jan. 5, 2005), to support his argument that failure to do so is reversible error. In Cole, this court stated as follows:

It is the ultimate task of the trial judge to determine the expendable income of a child-support payor. This income may differ from income for tax purposes. As a rule, when the amount of child support is at issue, the appellate court will not reverse the trial judge absent an abuse of discretion. In setting the amount of child support that a noncustodial parent must pay, reference to the most recent child-support chart is mandatory. ... Administrative Order Number 10 sets out the definition of income for child-support purposes and the manner of calculation of support. It also requires the parties to execute affidavits of financial means and lists factors the court should consider when determining support at variance to the chart. Although the court must consider the chart, it does not have to use the chart amount if the circumstances of the parties indicate another amount would be more appropriate.

Id. at ___, ___ S.W.3d at ___ (citations omitted).

Here, the trial court used Mr. Sims's 2004 gross income figure, reduced it by the amount of Ms. Sims's gross annual income, reduced it further by fifteen percent for tax withholdings (estimated based upon information apparently contained in the parties' letter briefs to the court), and calculated support on the balance per the family support chart. Considering that Mr. Sims's gross income for one year was all that he introduced into evidence, this court is not willing to say that the trial court abused its discretion in taking that evidence and reducing it by estimated income taxes and Ms. Sims's gross income in arriving at the amount of Mr. Sims's child-support obligation. Mr. Sims was free to introduce copies of his tax returns if he believed that they would result in a lower amount of support; he apparently chose not to do so.

Mr. Sims additionally argues that the trial court erred in the method it used to calculate his child-support obligation. He contends that the judge should have separately calculated the amount of his child-support obligation and Ms. Sims's child-support obligation, then based his support obligation on the difference. We note that, had the trial court done so, the amount of Mr. Sims's support obligation would not significantly differ from what the trial court ordered him to pay. For the reasons stated herein, we hold that the trial court's calculation of Mr. Sims's child-support obligation did not violate Administrative Order No. 10.

Affirmed.

Gladwin and Vaught, JJ., agree.