SHERYL ANN MAXWELL v. CHARLES TAYLOR MAXWELL
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RENDERED SEPTEMBER 29, 2000; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-003057-MR
SHERYL ANN MAXWELL
APPELLANT
APPEAL FROM LOGAN CIRCUIT COURT
HONORABLE TYLER L. GILL, JUDGE
ACTION NO. 95-CI-00459
v.
CHARLES TAYLOR MAXWELL
APPELLEE
OPINION
AFFIRMING IN PART,
REVERSING IN PART AND REMANDING
** ** ** ** **
BEFORE:
COMBS, JOHNSON AND KNOPF, JUDGES.
JOHNSON, JUDGE:
Sheryl Ann Maxwell has appealed from the final
judgment entered on October 13, 1998, by of the Logan Circuit
Court which overruled her exceptions to the findings and
recommendations contained in the commissioner’s report, and which
adopted those findings as its own.
all, of her arguments have merit.
We agree that some, but not
Thus, we affirm in part,
reverse in part and remand.
Sheryl and Charles Taylor Maxwell were married in 1974.
Their twenty-three year marriage produced three children: Charles
Taylor Maxwell was born on September 6, 1977, Erica Paige Maxwell
was born on July 12, 1979, and Jeffrey Blake Maxwell was born on
January 13, 1983.
The children were 20, 18, and 14 years old
respectively, at the time the decree of dissolution was entered.
The parties resolved many of the issues arising from the breakup
of the marital relationship by agreement; however, other issues
were litigated before the Domestic Relations Commissioner.
Sheryl, who was eighteen years old at the time the
parties married, was not employed during the marriage.
Charles
did not dispute Sheryl’s testimony that they mutually agreed that
she would be a full-time homemaker and the primary caretaker of
the children.
During the initial years of the marriage, Charles
was employed in sales.
In 1990, he formed a corporation and
purchased an Arby’s franchise.
The fast-food restaurant in
Russellville, Kentucky, provides him with annual earnings of
approximately $100,000.
The parties agreed that Sheryl would have sole custody
of their youngest child, Blake.
They also agreed that Charles
would pay Sheryl $230,000 for her share of the business, and that
she was entitled to one-half his pension which had a value of
$390,000.
A Qualified Domestic Relations Order was entered
directing the plan administrator to distribute one-half of the
vested pension to Sheryl.
The marital residence was sold and the
net proceeds of approximately $62,000 were divided equally
between the parties.
The parties also agreed on the equal
division of the personalty.
An interlocutory decree of
dissolution was entered on October 30, 1997, reserving all
remaining issues for later adjudication.
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On November 13, 1997, a hearing was conducted before
the commissioner on the issues of child support, maintenance,
responsibility for certain dental expenses for their child,
Paige, health insurance coverage for all of the children,
allocation of the tax exemption for the parties’ minor child, and
attorney’s fees.
In his report, the commissioner made the
following recommendations to the trial court: (1) that Charles
pay child support of $860 per month for Blake; (2) that Charles
pay Sheryl $400 per month in maintenance for four years; (3) that
Charles be entitled to claim Blake as a dependent for income tax
purposes; (4) that each party be responsible for any debt
incurred since their separation; (5) that each party be
responsible for one-half of the costs and fees associated with a
time-share condominium owned by the parties until such time as it
is sold; (6) that each party pay his or her own attorney’s fees;
(7) that Charles provide health insurance for Blake and that the
parties equally divide any medical expenses not covered by
insurance; and, (8) that Charles not be responsible for the
dental work needed by the adult child, Paige.
Sheryl filed numerous exceptions to the commissioner’s
findings and recommendations.
they were not timely.
Although Charles filed exceptions,
On March 5, 1998, the trial court ordered
the commissioner to supplement his recommendations with findings
of fact on the issues of the gross and net incomes of both
parties, the reasonable expenses of both parties, and the child
support calculations.
The trial court held in abeyance any
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decision on the merits of the exceptions until the supplemental
report was provided.
In his supplemental report, the commissioner found that
Charles’ monthly gross income was $8,416, and that his net
monthly income was $5,800.
He imputed a gross income to Sheryl
of $1,213 per month ($7.00 per hour for 40 hours a week), and a
net monthly income of $925.00.
Although Sheryl had testified
that her expenses amounted to $3,900 per month, the commissioner
stated that many of her expenses “seemed excessive,” and found
that her reasonable monthly expenses totaled only $1,869.
He
found that Charles had monthly expenses totaling $2,267.
On October 13, 1998, the trial court entered its final
judgment in which it overruled the exceptions of both parties and
adopted the commissioner’s recommendations.
Sheryl’s motion to
alter, amend or vacate the judgment was denied on November 12,
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1998, and Sheryl’s appeal followed.1
Additional facts will be
discussed that are pertinent to the particular issue addressed.
Sheryl first argues that the trial court erred in its
adoption of the commissioner’s findings and recommendations with
respect to the amount of Charles’ income for purposes of
establishing his child support obligation.
Sheryl, who works
part-time and has actual earnings of about $500 per month, does
not complain that the trial court imputed monthly income to her
of $1,213.
However, Sheryl contends that the trial court erred
in failing to impute additional income to Charles consistent with
the testimony of her expert witnesses.
We do not find error in
this regard.
The commissioner had several sources of evidence
pertaining to Charles’ income, including the parties’ personal
income tax returns for the five years prior to the dissolution
and Charles’ corporation’s tax returns.
1
At his deposition taken
Charles is also dissatisfied with that portion of the
judgment which awarded maintenance to Sheryl. Indeed, the
introduction of his brief states that “[t]his is a cross-appeal
in a marital dissolution case,” and he asks that we reverse the
trial court’s determination that Sheryl is entitled to
maintenance in the first instance. Although Charles is entitled
to make that argument in support of affirming the judgment, since
he did not file a notice of appeal or cross-appeal, he is not
entitled to seek affirmative relief from the judgment. Kentucky
Rules of Civil Procedure (CR) 74.01; Standard Farm Stores v.
Dixon, Ky., 339 S.W.2d 440 (1960); Lainhart v. Rural Doxol Gas
Co., Ky., 376 S.W.2d 681 (1964); Mullins v. Bullens, Ky., 383
S.W.2d 130 (1964). Sheryl has moved this Court to dismiss the
purported cross-appeal and to strike those portions of his brief
which address his argument that she did not meet the statutory
threshold for maintenance. Since Charles failed to file a notice
of cross-appeal, and thereby waived any error with respect to the
issue of Sheryl’s entitlement to maintenance, it is unnecessary
to enter a formal order dismissing a cross-appeal that does not
exist.
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in February 1997, Charles testified that he was not working full
time at the business as he had in the past.
However, by the time
of the trial, Charles testified that he was working 40 to 50
hours a week at the franchise, yet at the same time, he testified
that his income had decreased from its highest amount of $108,885
in 1995, to $6,500 per month, or $78,000 annually.
Sheryl’s
expert witnesses who had reviewed Charles’ deposition, testified
that Charles’ restaurant was “over-managed,” and that if Charles
would spend more time in the business, he could eliminate two of
the four managers’ positions which would result in an income of
about $140,000 annually.
They also questioned the large increase
in the corporation’s capital expenditures and a significant
increase in labor costs during the period the dissolution was
pending.
The commissioner rejected Charles’ proof that his
income had been drastically reduced.
He found that his income
“was and should be considered the same monthly income as B.E.S.T.
Corporation as the Corporation and Mr. Maxwell are synonymous.”
Thus, the commissioner calculated Charles’ monthly income to be
$8,416 ($100,992 annually), which is very close to the amount
reported as personal income for the last year the parties were
living together.
However, the commissioner essentially ignored
the expert evidence offered to support Sheryl’s argument that the
corporate veil should be pierced to determine whether Charles was
manipulating his expenses to avoid his financial obligations
arising from the marital relationship, and the evidence that he
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could increase his income by not relying on four managers to run
the business for him.
It is axiomatic that the ultimate objective of a
proceeding to determine child support is to secure the support
needed by the children commensurate with the ability of the
parents to meet those needs.
Further, “[b]oth our statutory
scheme and our case law demand that whenever possible the
children of a marriage should be supported in such a way as to
maintain the standard of living they would have enjoyed had the
marriage not been dissolved.”2
Our analysis of this issue begins
with Kentucky Revised Statutes (KRS) 403.212(2), which provides
in pertinent part as follows:
(a)
“Income” means actual gross income of
the parent if employed to full capacity
or potential income if unemployed or
underemployed.
. . .
(c)
2
For income from self-employment, rent,
royalties, proprietorship of a business,
or joint ownership of a partnership or
closely held corporation, “gross income”
means gross receipts minus ordinary and
necessary expenses required for selfemployment or business operation.
Straight-line depreciation, using
Internal Revenue Service (IRS)
guidelines, shall be the only allowable
method of calculating depreciation
expense in determining gross income.
Specifically excluded from ordinary and
necessary expenses for purposes of this
guideline shall be investment tax
credits or any other business expenses
inappropriate for determining gross
income for purposes of calculating child
support. Income and expenses from selfemployment or operation of a business
shall be carefully reviewed to determine
Stewart v. Madera, Ky.App., 744 S.W.2d 437, 439 (1988).
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an appropriate level of gross income
available to the parent to satisfy a
child support obligation. In most
cases, this amount will differ from a
determination of business income for tax
purposes. Expense reimbursement or inkind payments received by a parent in
the course of employment, selfemployment, or operation of a business
or personal use of business property or
payments of expenses by a business,
shall be counted as income if they are
significant and reduce personal living
expenses such as a company or business
car, free housing, reimbursed meals, or
club dues.
Very recently, this Court held that KRS 403.212(2)(c)
“confronts trial courts with the unenviable task of
distinguishing between a self-employed child-support obligor’s
taxable income and what may be called his or his disposable
income.”3
The statute plainly requires the trial court to
“carefully review” the income and expenses of a business so that
a child of the marriage will be supported at the appropriate
level.
The trial court is authorized, indeed is charged by the
statute, to look behind the business structure, corporate or
otherwise, for manipulation or mismanagement where the evidence
so warrants.
On the other hand, we appreciate the trial court’s
reluctance, even with the aid of expert witnesses, to substitute
its judgment for that of a party’s on the proper manner to
operate a business.
From his findings, it is obvious that the commissioner
did not blindly accept the testimony of Charles regarding his
current earnings, nor was he satisfied that Charles’ personal
3
Snow v. Snow, Ky.App., ____ S.W.3d ____ (rendered July 14,
2000).
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income tax returns reflected an accurate picture of his ability
to pay child support.
Rather, the commissioner established
Charles’ earnings as being equal to those of his corporation,
recognizing that, as the sole shareholder, all retained earnings
were available to Charles.
While it would have been preferable for the
commissioner to have specifically addressed the expert testimony
offered by Sheryl, it is apparent that the commissioner was not
convinced that any improper manipulation had occurred or that
further adjustment to Charles’ income was appropriate.
A review
of the record reveals that Charles did counter this evidence with
his own testimony supporting his need for the four managers, the
same number of managers he had consistently employed at the
restaurant.
He also offered a reasonable justification for the
increase in capital expenditures, including the need to replace
seven-year-old equipment and the roof on the restaurant.
This
evidence is sufficient to support the commissioner’s
recommendation, and the trial court’s ultimate findings; and
accordingly, the decision in this regard will not be disturbed in
this appeal.4
Next, Sheryl argues that the trial court clearly erred
and abused its discretion by adopting the findings and
recommendations of the commissioner with respect to the award of
maintenance.
This is the most troublesome issue we must address
in Sheryl’s appeal.
As stated earlier, the trial court ordered
4
CR 52.01; McKinney v. McKinney, Ky.App., 813 S.W.2d 828
(1991).
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Charles to pay maintenance of $400 per month for four years.
Sheryl, who had requested maintenance of $1,200 per month until
Blake reached majority, and $2,000 per month after that until she
is able to make withdrawals from the pension plan without
penalty, contends that the award is both inadequate as to amount
and duration.
As with the previous issue, we begin our discussion
with the applicable law.
KRS 403.200(2) provides that once it is
established that maintenance is appropriate, the award “shall be
in such amounts and for such periods of time as the court deems
just” after considering the following “relevant factors:”
(a)
The financial resources of the party
seeking maintenance, including marital
property apportioned to him, and his
ability to meet his needs independently,
including the extent to which a
provision for support of a child living
with the party includes a sum for that
party as custodian;
(b)
The time necessary to acquire sufficient
education or training to enable the
party seeking maintenance to find
appropriate employment;
(c)
The standard of living established
during the marriage;
(d)
The duration of the marriage;
(e)
The age, and the physical and emotional
condition of the spouse seeking
maintenance; and
(f)
The ability of the spouse from whom
maintenance is sought to meet his needs
while meeting those of the spouse
seeking maintenance.
“Under this statute, the trial court has dual
responsibilities:
one, to make relevant findings of fact; and
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two, to exercise its discretion in making a determination on
maintenance in light of those facts.”5
Both this Court and the
Supreme Court of Kentucky have held that maintenance is a matter
delegated to the sound discretion of the trial court.6
“Barring
a showing of absolute abuse” this Court is not to disturb the
resolution of this issue reached by the trial judge who
“comprises the heart, soul and conscience of a marital
dissolution.”7
It is undisputed that Charles is a college graduate
with a degree in business administration, and that he is the sole
owner of a corporation which provides him with an annual income
of more than $100,000.
On the other hand, Sheryl’s formal
education ceased at high school, and she has obtained no
additional training.
By agreement of the parties, she served the
family as a full-time homemaker; and as a result, Sheryl is
clearly disadvantaged with respect to competing for suitable
employment.
It is also undisputed that the parties enjoyed a
comfortable life style.
Their marital residence sold for over
$230,000, they were members of the local country club, the family
vacationed twice a year, at the beach and in the mountains, and
shopped at department stores.
Since the dissolution, Charles has
purchased a luxury automobile, a new house, and has remarried.
In contrast, Sheryl testified that she drives a minivan with over
5
Perrine v. Christine, Ky., 833 S.W.2d 825, 826 (1992).
6
Id.; Moss v. Moss, Ky.App., 639 S.W.2d 370 (1982); Browning
v. Browning, Ky.App., 551 S.W.2d 823 (1977); Leveridge v.
Leveridge, Ky., 997 S.W.2d 1, 2 (1999).
7
Moss, supra at 373.
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115,000 miles, buys her clothes at Walmart, and has had to put
most of her personalty in storage as her two-bedroom apartment is
too small to accommodate it.
In his initial report, the commissioner made the
following findings and observations with respect to the issue of
maintenance:
The Commissioner finds that [Sheryl] and
[Charles] are both well educated, articulate,
and capable of earning wages. The
Commissioner finds that [Sheryl] is not
employed but by expert testimony which she
proffered is capable of earning at least
$7.00 per hour based on a 40 hour work week,
and therefore in considering any maintenance
award, the Commissioner must assume that
wage. [Sheryl] has consistently testified
that she is unable to work because of her
dedication to her remaining minor child and
his swimming. [Sheryl] further testified that
she is only interested in working in her
son’s school or in a pet care facility which
could only be part time due to her dedication
to her son and his swimming. The
Commissioner does not find the testimony
compelling, and has advised [Sheryl]
throughout these proceedings that she is
capable of working and needs to work. Based
on [Sheryl’s] capabilities and ability to
work as evidenced by her own expert
testimony, and further based on the award to
[Sheryl] of approximately $500,000.00 in cash
awards as well as her personal property, and
further based on the fact that [Charles] has
assumed all of the parties’ debt but for that
debt which has been incurred by each
following their separation, it is the finding
of the Commissioner that [Sheryl] is not
entitled to life maintenance but only for a
term of years and that term of years being
(4) years beginning January, 1998. The
maintenance award per month shall be in the
amount of $400.00 for a period of 48 months
beginning January, 1998. This amount will
meet [Sheryl’s] expenses as submitted and
reviewed by the Commission when combined with
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her computed8 [sic] income, and earning[s]
from her property award.
It is apparent to this Court that the findings of the
commissioner, that were ultimately adopted by the trial court,
fail to conform to the requirement to “make relevant findings of
fact,”9 a matter which Sheryl brought to the attention of the
trial court both in her exceptions and in her motion to alter,
amend or vacate the judgment.
While the trial court directed the
commissioner to remedy this deficiency and to render a
supplemental report, the commissioner never made any findings
with respect to the income Sheryl could expect to earn from the
property set aside to her,10 or any findings with respect to the
factors in KRS 403.200(2)(b) to justify a short period of
rehabilitative maintenance, or any findings with respect to KRS
403.200(2)(c), the standard of living established during the
marriage.
In addition, many of the findings of fact are clearly
erroneous.
For example, Sheryl is not “well educated.”
also not “unemployed,” but employed part-time.
8
Although the
“Computed” should have been “imputed”.
9
She is
Perrine, supra at 826.
10
Sheryl testified that she paid rent of $900 per month and
that if, as she planned, she invested $60,000 of her cash
settlement into a down payment on a house, she could reduce that
figure to $600 per month. In determining Sheryl’s reasonable
monthly needs, the commissioner used the $600 amount, presumably
accepting as reasonable, her plan to invest some of the cash in
real estate. Sheryl’s expert witness testified that she could
expect to earn $700 per month on the cash remaining after the
purchase of a house. The commissioner questioned this witness
about the possibility of Sheryl’s obtaining an even greater
return, but he neglected to make a finding of any amount in
either report.
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commissioner did not find Sheryl’s explanation for working parttime to be “compelling,” Charles presented no evidence to refute
Sheryl’s claim that she wanted to be available to allow her son
to continue his participation in swimming and to be able to
accompany him to out-of-town competitions.
Also, the
commissioner’s reference to Charles’ assumption of the marital
debt is not supported by the record which actually indicates that
there was no marital debt to assume.
The findings with respect to Sheryl’s reasonable needs
are even more seriously flawed.
In his supplemental report, the
commissioner found Sheryl’s monthly expenses to be $1,869.
Sheryl had testified that her monthly expenses exceeded $3,900
and she presented documentary evidence to support that claim.
However, the commissioner, without elucidation, eliminated many
of the items in her monthly budget, including: costs for the care
of the family pet; the fee for her cell phone, which Sheryl
testified was needed because her car frequently broke down; auto
club dues (again necessitated by the aging vehicle); all the
expenses she incurs for Blake’s participation in competitive
swimming, including travel to swim meets; and Blake’s birthday
and Christmas gifts.
The items totally eliminated from Sheryl’s
monthly budget by the commissioner amount to nearly $500 per
month.
Other expenses were essentially cut in half by the
commissioner, including the amount Sheryl testified, and
documented, that she spends for food, gas, clothing, laundry,
hair cuts, entertainment, credit card debt, cable television and
household supplies.
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On the other hand, in arriving at Charles’ monthly
expenses, the Commissioner found that he had a mortgage payment
of $1,200 per month although Charles testified that his housing
expense was $750 per month.
Although none of the children
resides with Charles, and although his new wife presumably shares
in the household expenses,11 the commissioner determined that
Charles’ reasonable monthly needs exceeded those of Sheryl.
Without exception, the monthly expenses eliminated from
Sheryl’s monthly budget were items typically enjoyed during the
marriage; i.e., expenses related to the care and maintenance of
the family pet, their child’s extra-curricular activities,
birthday and Christmas gifts for the child.
The commissioner’s
determination that these expenses and half of several other items
were “excessive” demonstrates a lack of appreciation of the
settled principle that the issue of what is “reasonable” must be
ascertained within the context of the standard of living enjoyed
during the marriage.12
In construing a statute nearly identical
to our own, the Missouri appellate court held that
[i]n many marriages by tacit or express
agreement, the wife remains at home and cares
for the children and foregoes her opportunity
to develop a career or acquire job
experience. Where such a spouse has been out
of the job market for extended periods. . .
11
The Commissioner refused to allow Sheryl to inquire into
the contribution, if any, Charles’ current wife makes to offset
Charles’ actual monthly household expenses. Clearly, her income
and contribution are relevant to the issue of his ability to pay
maintenance, and on remand this evidence must be allowed. See
Roberts v. Roberts, Ky.App., 744 S.W.2d 433, 435 (1988).
12
Casper v. Casper, Ky., 510 S.W.2d 253, 255 (1974); Sharp
v. Sharp, Ky., 516 S.W.2d 875, 877 (1974); Weldon v. Weldon,
Ky.App., 957 S.W.2d 283, 285 (1997).
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it may be proper for the court to place
greater emphasis on the lifestyle enjoyed
during the marriage, the duration of the
marriage and other traditional factors.
Reasonable needs as used in the statute
is a relative term. In a marriage of lengthy
duration where one spouse has foregone career
development, the marital standard of living
may serve as an important guide in computing
the spouse’s reasonable needs. In a very
practical sense it is frequently the best
evidence of what the parties have together
determined their “reasonable needs” to be
[footnote omitted].13
The commissioner attempted to impress upon both parties
that they would not be able to maintain the same lifestyle
separately that they had maintained during the marriage.
However, we agree with Sheryl that the record does not support
the commissioner’s findings on the issue of her “reasonable
needs.”
In all, considering the number of findings that are
clearly erroneous, and the lack of certain important findings,
the matter must be reversed and remanded for a re-evaluation of
the amount of maintenance.
Further, the trial court’s findings are inadequate with
respect to the issue of duration of maintenance.
Clearly, there
is evidence to support the commissioner’s observation that an
award for life is not indicated, including Sheryl’s age and lack
of any health problems.
However, our review of the record does
not reveal any evidence that remotely suggests that Sheryl will
be self-sufficient, that is, able to meet her own reasonable
needs after a period of four years, particularly in light of the
13
Brueggemann v. Brueggemann, 551 S.W.2d 853, 857
(Mo.App.1977).
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fact that she will no longer be receiving child support.
Under
these circumstances, we hold that the trial court abused its
discretion in setting the duration of the maintenance award, and
this too must be reversed and reconsidered on remand.14
Next, Sheryl argues that the trial court erred in its
allocation of the tax exemption for Blake to Charles.
In his
report, the commissioner, without any explanation, recommended
that Charles be entitled to claim Blake as a dependent for
federal and state income tax purposes.
Again, Sheryl’s complaint
addresses both the lack of findings to support the allocation, as
well as the propriety of the award.
Charles relies on the line
of cases that holds that regardless of which parent is awarded
custody, the trial court retains discretion to allocate the
exemption to the non-custodial parent.15
He insists that the
failure of the trial court to make any findings in allowing him
to claim Blake as an exemption is excusable since his earnings,
and thus his tax liability, are substantially higher than
Sheryl’s.
Generally, the determination of which party is entitled
to claim a minor child as a tax dependent is governed by
reference to federal law, specifically, 26 U.S.C.A. § 152(e),
which provides that a child of divorced parents shall be treated
for tax purposes as a dependent of the custodial parent.
14
See Frost v. Frost, Ky.App., 581 S.W.2d 582, 584-85
(1979).
15
See Pegler v. Pegler, Ky.App., 895 S.W.2d 580 (1995);
Marksberry v. Riley, Ky.App., 889 S.W.2d 47, 48 (1994); Hart v.
Hart, Ky.App., 774 S.W.2d 455, 457 (1989).
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However, we agree with Charles that the issue is one which is
ultimately left to the sound discretion of the trial court.
In
exercising that discretion, however, we believe it is incumbent
upon the trial court to articulate findings for divesting the
custodial parent of the exemption.
In the case sub judice, it is obvious that Charles does
have significantly more income than Sheryl.
However, it is also
apparent from the evidence that the amount of child support he
has been ordered to pay does not provide for the entirety of
Blake’s needs.
Further, this is not a situation where the income
of the custodial parent is at a level eliminating the need for
the exemption.
Sheryl has earnings from her part-time
employment, maintenance which is taxable to her, and interest
income from her marital property.
More importantly, there is no finding that allocating
the exemption to Charles would benefit Blake.
“A trial court
should allocate the exemption so as to maximize the amount
available for the care of the children.”16
Accordingly, on
remand, the trial court is directed to make findings, with
reference to the evidence, to justify the allocation of the
exemption.
Finally, Sheryl has raised three issues with respect to
the judgment’s rulings relating to health insurance and medical
expenses.
First, she argues that the trial court erred in
requiring that the parties share equally any medical expenses for
Blake not covered by insurance.
16
Clearly, this ruling is
Hart, supra at 457.
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erroneous as a matter of law.
KRS 403.211(8) mandates that
“[t]he cost of extraordinary medical expenses shall be allocated
between the parties in proportion to their adjusted gross
incomes.”
“Extraordinary medical expenses” is defined by the
statute as “uninsured expenses in excess of one hundred dollars
($100) per child per calendar year.”
This part of the judgment
is reversed, and the matter is remanded for the trial court to
enter a new judgment in conformity with the statute.
Next, Sheryl contends that the trial court erred in
failing to address the issue of health insurance coverage for the
two children who have reached the age of majority, but who are
full-time college students.
This issue, like the previous one,
is governed by a specific statutory provision.
KRS
403.211(7)(a), provides:
The court shall order the cost of health
care of the child to be paid by either or
both parents of the child regardless of who
has physical custody. The court order shall
include:
1.
A judicial directive designating which
parent shall have financial
responsibility for providing health care
for the dependent child, which shall
include, but not be limited to,
insurance coverage, payments of
necessary health care deductibles or
copayments; and
2.
A statement providing that if the
designated parent’s health care coverage
provides for covered services for
dependent children beyond the age of
majority, then any unmarried children up
to twenty-five (25) years of age who are
full-time students enrolled in and
attending an accredited educational
institution and who are primarily
dependent on the insured parent for
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maintenance and support shall be
covered.
Although Sheryl brought this statute to the attention
of both the commissioner and the trial court, the judgment does
not address the issue of health insurance coverage for Paige and
Taylor.
Charles has never contested the fact that the two older
children are unmarried, attending school full-time, and primarily
dependent on him and Sheryl for their support.
At a hearing
before the commissioner on October 28, 1997, Charles testified
that both adult children were still covered under his health
insurance policy.
Sheryl expressed concern at that time that the
judgment should require Charles to continue to insure the two
older children as required by the statute, but the commissioner
opined that he was without authority to require such coverage.
At the final hearing held two weeks later, Charles testified that
he had removed Taylor and Paige from his health insurance policy.
KRS 403.211(7)(a), which was amended in 1996, plainly
mandates, as evidenced by its use of the word “shall,”
17
that
the parent responsible for providing health insurance coverage
for any minor children, shall also be required to provide such
coverage, if available, for children past the age of majority who
are unmarried, in school full-time and who are dependent on their
parent(s) for their support.
This statute evinces a legislative
intent that children who are pursuing a college education be
afforded health insurance by their parents whenever possible.
17
KRS 446.010; see also Hardin County Fiscal Court v. Hardin
County Board of Health, Ky.App., 899 S.W.2d 859, 861 (1995)
(“[i]t is elementary that ‘may’ is permissive and ‘shall’ is
mandatory in statutory language.”).
-20-
Despite the statute’s seeming clarity, the
commissioner, apparently under the mistaken belief that he had no
such authority, did not make any findings whatsoever about the
status of the children or the availability of the coverage.
At
the hearing on the exceptions, Charles’ counsel informed the
trial court that such coverage was not available.
However, a
review of the testimony before the commissioner revealed that
such coverage was available on October 28, 1997, and canceled on
Charles’ initiative on, or before,
November 13, 1997.
This part
of the judgment is reversed, and the matter is remanded for the
trial court to make findings with respect to the statutory
provisions and to enter a new judgment in conformity therewith.
The last issue concerns the failure of the trial court
to address the issue of dental treatment needed by Paige.
Sheryl presented evidence that Paige, who turned 18 years old
four months prior to the final hearing, was advised to have this
treatment prior to reaching the age of majority.
She alleged
that Paige did not have the treatment prior to her eighteenth
birthday because Charles refused to pay for the treatment.
Charles, who was ordered to pay 100% of the children’s medical
expenses pendente lite, testified that it was his belief that the
procedure was desired purely for cosmetic purposes.
As with the tax exemption issue, the commissioner made
no findings to support his recommendation that Charles not be
responsible for the treatment.
Without appropriate findings we
are unable to determine whether the trial court adopted the
commissioner’s recommendation because it believed the treatment
-21-
was unnecessary, or whether it accepted Charles’ argument that
since Paige had turned 18, he could not be ordered to pay for the
treatment.
This part of the judgment is reversed, and the matter
is remanded for the trial court to make adequate findings that
could be reviewed on appeal, if such relief is sought.
Accordingly, the judgment of the Logan Circuit Court is
affirmed in part, reversed in part, and the matter is remanded
for consideration of additional evidence as required by this
Opinion, and as otherwise determined at the discretion of the
trial court, and for the entry of a new judgment based on the
additional findings and in a manner consistent with this Opinion.
COMBS, JUDGE, CONCURS.
KNOPF, JUDGE, CONCURS IN PART, DISSENTS IN PART AND
FILES SEPARATE OPINION.
KNOPF, JUDGE, CONCURRING IN PART AND DISSENTING IN
PART:
I agree with the majority opinion on all issues except in
regard to setting aside the trial court’s maintenance order. This
case is yet another example of the need for maintenance
guidelines to be adopted by the legislature or by the Supreme
Court of Kentucky.
In the absence of such guidelines, there is
no consistency among trial courts in determining the appropriate
amount and duration of maintenance awards.
This is often an area
of great unfairness in the family law cases of Kentucky.
Nevertheless, I cannot agree with the majority’s
decision to vacate the trial court’s maintenance award in this
case.
“The decision to grant or deny a maintenance award lies
-22-
within a trial court’s sound discretion as it applies the
governing factors of KRS 403.200 to the parties circumstances
upon dissolution of marriage”.
S.W.2d 1, 2 (1999).
Leveridge v. Leveridge, Ky., 997
Citing 403.200(2).
This Court is not
authorized to substitute its judgment for that of the trial court
in reviewing a maintenance award.
Id.
Although the factual
findings supporting the maintenance order could have been more
thorough, and the evidence could have supported a different award
than the trial court chose to make, I cannot say that the trial
court’s determinations as to maintenance constituted an abuse of
discretion or were clearly erroneous.
Consequently, I would
affirm the trial court’s order on this issue.
BRIEF AND ORAL ARGUMENT FOR
APPELLANT:
BRIEF AND ORAL ARGUMENT FOR
APPELLEE:
B. Alan Simpson
Bowling Green, KY
J. Stewart Wheeler
Russellville, KY
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