JULIE DIANNE CHURCH v. RICKY LLOYD CHURCH
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RENDERED:
JANUARY 6, 2006, 10:00
NOT TO BE PUBLISHED
A.M.
Commonwealth Of Kentucky
Court of Appeals
NO. 2004-CA-000653-MR
JULIE DIANNE CHURCH
v.
APPELLANT
APPEAL FROM WARREN CIRCUIT COURT
HONORABLE MARGARET RYAN HUDDLESTON, JUDGE
ACTION NO. 01-CI-01165
RICKY LLOYD CHURCH
APPELLEE
OPINION
AFFIRMING IN PART,
VACATING IN PART AND REMANDING
** ** ** ** **
BEFORE:
GUIDUGLI, KNOPF, AND McANULTY, JUDGES.
GUIDUGLI, JUDGE:
In this dissolution action, Julie Dianne
Church has appealed from the Judgment and two subsequent orders
entered by the Warren Circuit Court regarding child support,
medical expenses, as well as the valuation of business and
marital property.
We affirm in part, vacate in part and remand.
Julie and Ricky Lloyd Church were married in Long
Beach, California, on February 29, 1976.
of the marriage:
Two children were born
Annie, born on March 30, 1986; and Michael,
born on January 24, 1989.
Both Julie and Ric were self-
employed, and ran a repair business in Bowling Green, Kentucky
called Hi Fi Doctor.
Julie and Ric separated on July 3, 2001,
and Julie filed a Petition for Dissolution of Marriage on
September 6, 2001.
Less than three weeks later, Ric was ordered
to vacate the marital home and business, and the business was
eventually sold at auction during the pendency of the
dissolution proceedings.
The circuit court entered a bifurcated
decree of dissolution on March 8, 2002, reserving the issues of
the division of marital property and debts, child custody, and
child support.
A hearing on the remaining issues was held on October
2, 2003, and the circuit court issued its Findings of Fact,
Conclusions of Law and Judgment on December 30, 2003.
The
circuit court awarded the parties joint custody of the two minor
children, naming Julie as the primary residential custodian.
Ric was awarded liberal visitation and was ordered to pay Julie
child support for both children in the amount of $229 per month
as well as an arrearage of $4,122 dating back to the date Julie
filed a motion for child support.
The circuit court also found
Julie to be entitled to an offset from Ric’s proceeds
representing one-half of the medical expenses she incurred for
their children.
Ric was awarded items of personal and business
property, including a Kentucky Colonel Award and computer
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equipment and software, all of which Julie was ordered to return
to his possession.
Finally, the circuit court found that Ric
was not entitled to an offset from Julie’s proceeds due to his
discovery of 444 missing service tickets from their business.
Both Julie and Ric filed motions to alter, amend or
vacate the circuit court’s judgment.
Ric argued that Julie was
not entitled to child support as neither child lived with her,
that he was entitled to a $21,000 offset based on the discovered
service tickets as well as a monetary offset for the boat
awarded to him because Julie left it exposed to the elements
while it was in her possession.
In her motion, Julie argued
that the items she was ordered to return to Ric, namely the
Kentucky Colonel Award and the electrical equipment and
software, were no longer in her possession.
By an order entered February 3, 2004, the circuit
court denied Julie’s motion, but granted Ric’s motion in part.
Regarding Ric’s personal items, the circuit court ordered him to
provide Julie with a description of the equipment and software
and their respective values.
Once received, Julie was ordered
to give him either possession of those items or their value.
Regarding custody, the circuit court did not designate either
party as the primary residential custodian of Annie, and allowed
Michael to decide with which parent he wished to reside by
filing an affidavit.
The circuit court then recalculated the
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amount of back-due child support owed to be $2,772, representing
child support for Michael from July 2002 to December 2003.
Furthermore, the circuit court agreed with Ric that Julie was
not entitled to an offset for the medical expenses because they
were paid with marital funds.
Regarding the missing service
tickets, the circuit court determined that Ric had established
that there was business income unreported by Julie, entitling
him to one-half of the $42,000.
Finally, the circuit court
ordered Julie to pay Ric $2,000, representing the value of boat
that had deteriorated while in her possession.
Julie’s motion
to alter, amend or vacate that ruling was denied on March 1,
2004, and this appeal followed.
On appeal, Julie argues that the circuit court erred
by not awarding child support for Annie, by finding $42,000 in
missing business income existed, by not ordering Ric to pay a
portion of the children’s medical expenses, by improperly
determining the value of the boat, and by ordering her to pay
for software.
Ric counters each issue raised in her brief.
CR 52.01 provides that in actions tried without a
jury, “the court shall find the facts specifically and state
separately its conclusions of law thereon and render an
appropriate judgment.”
The court’s findings of fact “shall not
be set aside unless clearly erroneous, and due regard shall be
given to the opportunity of the trial court to judge the
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credibility of the witnesses.” 1
A reviewing court is not
permitted to substitute its own findings of fact for those of
the trial court “where they were not clearly erroneous.” 2
First, we shall address Julie’s argument regarding
child support.
The circuit court originally awarded joint
custody, with Julie being designated as the primary residential
custodian, although noting that Annie was currently living with
a friend.
Ric was ordered to pay Julie child support in the
amount of $229 for both children, retroactive to July 11, 2002.
On reconsideration, the circuit court found that Annie had not
resided with Julie during the time she sought child support and
did not currently reside with her.
Therefore, the circuit court
did not name either party as her primary residential custodian,
nor was any support awarded on her behalf.
Regarding Michael’s
residency, the circuit court determined that he should have a
role in deciding where he was going to live.
Based upon these
findings, the circuit court ruled that Ric owed Julie an
arrearage on child support at a rate of $154 per month for
Michael only, and that neither party was entitled to current
child support for Michael until his residence was determined.
The circuit court declined Julie’s request to reconsider these
1
CR 52.01.
2
Reichle v. Reichle, 719 S.W.2d 442, 444 (Ky. 1986).
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rulings, noting that Annie had not lived with Julie for a
substantial amount of time.
In her brief, Julie argues that there is no evidence
of record to support the circuit court’s finding that Annie had
not lived with her during the time she sought child support,
pointing to testimony that Annie did not move out until after
the sale of the marital residence in September 2003.
Also,
Julie continued to support Annie after she left home, by paying
for her medical and dental bills, for her college tuition, and
for other living expenses.
On the other hand, Ric continues to
argue that the designation of a primary residential custodian
and an award of support for Annie would be inappropriate as she
did not live with either parent.
Based upon our review of the record, we agree with
Julie that there is no evidence in the record to support the
circuit court’s finding that Annie did not live with Julie
during the entire time she sought support.
On the contrary,
Julie testified at the October 2003 trial that Annie moved out
only after the sale of their home in September, well after the
July 2002 date on which she requested child support.
For this
reason, it appears that the circuit court’s finding regarding
Annie’s residence during the period in question was not based
upon substantial evidence of record.
Accordingly, we must
vacate this portion of the circuit court’s ruling, and remand
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the matter for a factual determination as to when Annie stopped
living with Julie and, if appropriate, the entry of an award of
support for Annie during the time when she actually resided with
Julie.
Next, we shall address whether the circuit court erred
or abused its discretion in determining that there existed
$42,000 in unreported income from the parties’ business.
While
initially finding that Ric’s discovery of the missing service
tickets from a backup copy of their business records did not
warrant a finding of unreported income by Julie, the circuit
court reconsidered this ruling, finding that the records Ric
produced at the October 2003 trial established his claim.
In
her brief, Julie asserts that the evidence does not support such
a finding based upon previous years’ gross income and the state
of the repair industry.
Moreover, she blames Ric for depleting
the business account of money, “sabotaging” the business, and
performing shoddy work.
She also claims that the tickets
represent a period of time both before and after she took
control of the business, and those tickets after she took
possession only totaled $8,470.
The pre-separation tickets, she
claims, were duplicated and inflated.
In his brief, Ric states
that he discovered the missing tickets when he compared data
from his backup copy of the repair tickets made prior to his
leaving the business to the backup copy Julie provided.
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With
this information, he was then able to retrieve the missing
tickets from the business computer’s hard drive, once he
received it from Julie.
He points out that Julie in effect
authenticated the missing tickets by contacting the various
customers and asking them to verify payment, and posits that if
such payments were made, then Julie failed to report the income.
We cannot perceive any error or abuse of discretion by
the circuit court in awarding Ric an offset based upon his
discovery of the missing repair tickets.
Julie did little, if
anything, to contest the tickets once Ric entered them as an
exhibit during the trial.
Not until the circuit court altered
its first ruling and decided to award Ric an offset did Julie
attempt to contest this issue, when she simply argued that no
new evidence was introduced at the post-trial hearing that would
support such a ruling.
We must hold that the circuit court had
sufficient evidence before it in the form of the recovered
repair tickets to rule as it did, especially in light of Julie’s
failure to truly contest the introduction of and testimony
concerning the tickets.
We have also reviewed Julie’s three remaining
arguments regarding the payment of the children’s medical
expenses, the valuation of the fishing boat, and the missing
software awarded to Ric.
We perceive no error in the circuit
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court’s rulings on these issues, and need not address them any
further.
For the foregoing reasons, the judgment of the Warren
Circuit Court is affirmed in part, vacated in part and remanded
for further proceedings on the sole issue of child support.
McANULTY, JUDGE, CONCURS.
KNOPF, JUDGE, CONCURS WITH SEPARATE OPINION.
KNOPF, JUDGE, CONCURRING:
I concur with the reasoning
and the result reached in the majority opinion, but I write
separately to add additional grounds with respect to the trial
court’s ruling that Ric did not owe child support for the
parties’ oldest child, Annie.
Apparently, Annie moved out of
Julie’s house sometime before October 2, 2003, when she was
seventeen years of age.
Ric takes the position that Julie was
not entitled to receive child support for periods when Annie was
not living with her.
However, child support is paid for the benefit of the
child, not the parent.
(Ky.App. 1986).
Clay v. Clay, 707 S.W.2d 352, 353-54
Moreover, parents have a legal obligation to
support their own children until emancipation, completion of
high school, or completion of the high school year during which
the child reaches the age of nineteen.
KRS 403.213(3).
The
trial court initially designated Julie as the residential
custodian of both children.
As such, she had the primary
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responsibility to maintain a residence for the children and to
provide their day-to-day needs.
767, 779 (Ky. 2003).
Fenwick v. Fenwick, 114 S.W.3d
Thus, Ric and Julie’s obligations to
provide support for Annie during her minority did not end simply
because Annie ceased living with either parent.
Clearly, a child’s emancipation is grounds for
modification of child support, but it does not appear that Annie
was formally declared emancipated prior to her eighteenth
birthday.
The fact that Annie stopped living with her mother
may indicate a material change in circumstances warranting a
modification of child support.
KRS 403.213(1).
Nevertheless,
Annie’s residence alone is not necessarily determinative of
Ric’s obligation to pay child support.
The majority correctly holds that this matter must be
remanded for a determination of when Annie stopped living with
Julie and for an appropriate modification of support based upon
that finding.
I would note that the trial court found that
Julie had not been entirely honest with the court in her
representations concerning Annie’s residency.
It is within the
province of the trial court as the fact-finder to determine the
credibility of the witnesses and the weight given to the
evidence.
Uninsured Employers' Fund v. Garland, 805 S.W.2d 116,
117 (Ky. 1991).
Nevertheless, the trial court may not entirely
terminate Ric’s child support obligation to Annie during her
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minority unless it finds that Annie was emancipated prior to her
eighteenth birthday, or that Julie ceased to provide support for
Annie after she moved away.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Kelly Thompson, Jr.
Bowling Green, KY
David Keen
Bowling Green, KY
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