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HomeMy WebLinkAbout96-1163 SupportTERESA A. BAUER, Plaintiff Ve JAMES R. BAUER, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - SUPPORT DOMESTIC RELATIONS SECTION NO. 1163 SUPPORT 1996 DR 23,917 IN RE: APPEAL FROM SUPPORT ORDER BEFORE OLER, J. ORDER OF COURT AND NOW, this ~,~day of April, 1997, upon consideration of both parties' appeals from the order of court dated November 21, 1996, following a hearing and for the reasons stated in the accompanying opinion, and based upon the Court's determination that Plaintiff's monthly net income/earning capacity is $485 and that Defendant's monthly net income/earning capacity is $3512, it is hereby ordered that Defendant pay to the Domestic Relations Section, Court of Common Pleas, $1260 a month payable $315/week effective October 25, 1996, allocated $190 for spousal support and $125 for child support. THIS ORDER is for the support of Defendant's spouse, Teresa A. Bauer, and one child, Angela Marie Bauer (d.o.b. August 21, 1987). DEFENDANT having been given credit in the order appealed from for direct payments totaling $1452, and no issue having been made of this credit at the hearing, the court will do likewise in this order. Any arrearages due shall be paid within 60 days of the date of this order. UNREIMBURSED medical expenses are to be paid 87% by Defendant and 13% by Plaintiff. Defendant shall provide medical insurance coverage through his employer. THE TERMS of the order of November 21, 1996, not inconsistent herewith are incorporated herein by reference. Cindy S. Conley, Esq. 130 Walnut Street P.O. Box 810 Harrisburg, PA 17108 Attorney for Plaintiff BY THE COURT, J.~esley Ole~ ~. Barbara Sumple-Sullivan, Esq. 549 Bridge Street New Cumberland, PA 17070 Attorney for Defendant : rc TERESA A. BAUER, Plaintiff V® JAMES R. BAUER, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - SUPPORT DOMESTIC RELATIONS SECTION NO. 1163 SUPPORT 1996 DR 23,917 IN RE: APPEAL FROM SUPPORT ORDER BEFORE OLER, J. OPINION and ORDER OF COURT Presently before the court are appeals by both parties from a child and spousal support order recommended by the Domestic Relations Office and issued by the Court on November 21, 1996. A hearing was held on these appeals on January 10, 1997. Issues addressed in this opinion include: (1) what net income figure should be attributed to Teresa A. Bauer (Plaintiff), given her prior work history and present circumstances; (2) what net income figure should be attributed to James R. Bauer (Defendant), given the existence of a substantial overtime component in his earnings; and (3) whether Defendant's support obligation should be greater than the parties' net incomes would otherwise dictate due to an unusually high monthly mortgage payment on the marital residence occupied by Plaintiff. FINDINGS OF FACT; ORDER APPEALED FROM Based on the testimony and other evidence presented at the support hearing, we find the following: Plaintiff is Teresa A. Bauer; she currently resides in the parties' marital residence at 124 Old Willow Mill Road, NO. 96-1163 SUPPORT TERM Mechanicsburg, Cumberland County, Pennsylvania.~ Defendant is James R. Bauer; he currently resides at 2200 Potts Hill Road, Etters, York County, Pennsylvania.2 Plaintiff and Defendant were married on February 21, 1987.3 They have one child - Angela Marie Bauer, born August 21, 1987.4 Angela is nine years old.5 Plaintiff also has another child from a previous marriage - Jacqueline Renee Leach, born November 22, 1981.6 Plaintiff and Defendant separated on September 15, 1996, and Defendant has instituted an action for divorce.? Plaintiff has primary physical custody of both children.8 Plaintiff's Employment. Since the summer of 1995, Plaintiff's ~ N.T. 4. 2 N.T. 32. After leaving the marital home in September of 1996, Defendant moved in with his brother at the above address. Defendant currently does not pay his brother rent under any formal agreement, but does try to pay his brother about $100 per month. Id. 3 N.T. 5. 4 N.T. 6. Id. 6 N.T. 6. Plaintiff currently receives $25/week support for Jacqueline. Id. 7 N.T. 32. The action is pending in Cumberland County. See Domestic Relations Office Conference Summary, dated January 21, 1997. Plaintiff has requested marriage counselling. N.T. 59-60. Id. NO. 96-1163 SUPPORT TERM employment has consisted primarily of babysitting at her home.9 Plaintiff currently babysits a total of seven children.~° Her babysitting hours vary according to the day of the week but are usually from 6:15 a.m. until 6:00 p.m.~ The income that Plaintiff earns as a result of this endeavor is between $100 and $125 per week.~2 Prior to her babysitting job, and at the time of her marriage to Defendant, Plaintiff was a bakery manager for Weis Markets.~3 As a manager, Plaintiff earned $5.00 per hour, and her time on the job varied from 44 to 60 hours a week.~4 Plaintiff worked at Weis on a full-time basis until May of 1989.~s After leaving Weis, 9 N.T. 7. The Court notes that Plaintiff does some cake- decorating at home for friends and family, from which she earns about $5.00 to $10.00 per cake. N.T. 60. Plaintiff has also done some craft work in the past, receiving about $20.00 a week during a two-month period. N.T. 60-61. Plaintiff does not advertise for either of these two services. N.T. 61. Since the income from the cake-decorating and craft activities is both sporadic and minimal, we do not consider these endeavors to be a significant source of income for Plaintiff. ~0 N.T. 7. ~ N.T. 62. ~2 N.T. 7. Plaintiff does not charge by the hour; instead, she charges approximately $13.00 a day for most of the children. N.T. 62. ~s N.T. 9. Prior to her leaving Weis, Plaintiff had taken maternity leave from this employment when she was pregnant with her daughter Angela. Id. 3 NO. 96-1163 SUPPORT TERM Plaintiff began babysitting.~6 She was also working as a seasonal employee in a part-time capacity for Toys R Us, and attempted for a short period to sell vacuum cleaners.~? In August of 1990, Plaintiff was diagnosed with breast cancer and consequently stopped both babysitting and selling vacuum cleaners.~8 Plaintiff's testimony revealed that her diagnosis of breast cancer in August of 1990 has somewhat limited her employment opportunities.~9 Plaintiff's treatments to date have included a total of six surgeries, among them a lumpectomy and a mastectomy.2° Plaintiff has also undergone a six-month period of chemotherapy, as well as radiation treatment.2~ As a result of the surgeries, Plaintiff has limited use of her arms.22 Plaintiff returned to work in May of 1992 as a part-time cake decorator for Fox's Commissary.23 At the beginning of her employment at Fox's, Plaintiff was earning $6.25 per hour and she anticipates a hysterectomy in the near future. Id. N.T. 15. N.T. 13. N.T. 9. N.T. 9-10. N.T. 11-12. N.T. 12. Id. Plaintiff has not had any surgery since 1994; however, N.T. 18. NO. 96-1163 SUPPORT TERM working from approximately 9:00 a.m. until 3:00 p.m. on Monday, Wednesday, Friday, and, occasionally, Saturday.24 However, Plaintiff, at the suggestion of her supervisor, discontinued her employment at Fox's about a year and a half later.25 Plaintiff's supervisor suggested that she leave Fox's because Plaintiff's frequent surgeries were interfering with her ability to fill cake- decorating orders within required deadlines.26 Based upon Plaintiff's medical history, work background and physical limitations, the court finds that Plaintiff has a present net annual income/earning capacity of $5,812, and a net monthly income/earning capacity of $485. Defendant's Employment. Defendant has been employed with Conrail for approximately nine years as a locomotive engineer.27 He has a "base contract rate" at Conrail which in the past has translated to an annual salary of $36,623 for a 40-hour week.28 However, in practice Defendant has not received only his base 24 N.T. 13-14, 26. 25 N.T. 13. 26 N.T. 13, 26. 27 N.T. 35. Prior to his job as a locomotive engineer, Defendant was a brakeman and conductor. N.T. 36. Defendant's current job entails the transport of hazardous materials and various kinds of freight from Harrisburg to different cities, including Allentown, Philadelphia, and New York. Id. 28 N.T. 37, 39; Defendant's Exhibit 2. 5 NO. 96-1163 SUPPORT TERM salary.29 In 1993 at Conrail, Defendant earned $44,073.30 In 1994, he earned $57,257.3~ In 1995, he earned $51,989.32 In 1996, he earned about $69,443 from Conrail,33 and in addition about $1,000 as a part-time employee of Weis Markets.34 Defendant's level of income in 1996 from Conrail was partly attributable to (a) overtime compensation, a portion of which was a consequence of severe weather conditions in early 1996,3s (b) a lump sum payment for a retroactive 3.5% pay increase for the year 1995, and (c) a lump sum payment representing a 1% signing bonus.36 The total of the latter two items was about $2,500.37 In 1997, Defendant will be receiving wages at the aforesaid increased rate (i.e., at a rate 3.5% higher than his former rate), as well as a lump sum payment for the retroactive pay increase for N.T. 51. Defendant's Exhibit 1. N.T. 53; Defendant's Exhibit 1. Id. This figure is derived from Defendant's Exhibit 4, showing gross Conrail wages as of December 17, 1996, of $66,773.72. N.T. 48. N.T. 42-43. N.T. 43, 50. N.T. 43. NO. 96-1163 SUPPORT TERM 1996.38 This latter amount will be about $1,800.39 Defendant has stopped working at Weis Markets.4° Deductions from Defendant's gross income for 1997 will consist of federal, state and local taxes, Medicare contributions, and retirement contributions pursuant to a "two-tier" railroad retirement plan.4~ Under this retirement plan, a deduction of 7.65% on gross income up to $65,400 (for a maximum amount of $5,003) will be applied; and an additional deduction of 4.9% on gross income up to $48,600 (for a maximum amount of $2,381.00) will be applied.42 In 1996, the percent of Defendant's salary being withheld for taxes and Medicare contributions was about 19.5%.43 Based upon the fact that Defendant's 1996 gross income from 38 N.T. 50. 3~ Id. 40 N.T. 48-49. Defendant advised Plaintiff that he intended to reduce his income to the point that Plaintiff would not be entitled to more than $100 per week. N.T. 20. Defendant testified that he had not been serious about this threat. N.T. 43. 4~ N.T. 45-46; Defendant's Exhibit 4. Both counsel agree that these retirement deductions are proper for purposes of computing Defendant's net income. See Order of Court, January 10, 1997. A wage attachment for Defendant's support obligation will also be in effect. N.T. 44. Defendant's Exhibit 3. Defendant's Exhibit 4. NO. 96-1163 SUPPORT TERM Conrail was about $69,443, that the signing bonus included in that income will not be recurring, that some of the overtime component (attributable to severe weather conditions) will not be recurring, and that Defendant's 1997 income will be augmented by a lump sum representing a retroactive 3.5% 1995 pay increase ($1819), the court believes that a fair gross income figure attributable to Defendant at this time is $61,000. Retirement deductions on this amount for 1997 would be $6956, and deductions for taxes and Medicare will be estimated at $11,895.44 Defendant is thus found to have a present net annual income/earning capacity of $42,149, and a net monthly income/earning capacity of $3512.4s Marital Home. The parties purchased their marital home (in which Plaintiff currently resides) in 1994. Defendant's income was the only income used for the mortgage application.~6 However, at the time of their decision to buy the marital residence, both Plaintiff and Defendant had agreed that Plaintiff would be 44 If the parties continue to file joint returns, this figure would follow from past withholding practices. A more difficult calculation would be involved if (a) separate returns were filed by the parties, (b) Defendant deducted the spousal component from his support obligation for purposes of taxable income, and (c) Plaintiff included it in her income for such purposes. 4s As of the hearing on January 10, 1997, Defendant had made no support payments on the order issued November 21, 1996. N.T. 44. He apparently did make the December, 1996, mortgage payment on the marital home. Id. ~6 N.T. 52. When the parties applied for the mortgage, Defendant made about $57,257.00. N.T. 53. 8 NO. 96-1163 SUPPORT TERM employed.47 At the present time, Defendant has proposed that the marital residence be sold because the mortgage payments are beyond the parties' means.48 The monthly mortgage payment is presently $1504.49 Order under appeal. In the order under appeal, based upon the recommendation of the Domestic Relations Office, Defendant was required to pay $1410/month;s° $547 of this amount was intended to be for child support, and $863 was intended to be for spousal support,s~ The order also credited Defendant with direct payments totaling $1452.00, made toward the November mortgage and water bill.s2 Net income/earning capacities estimated for the computation were $903/week or $3909/month for Defendant, and $112/week or $485/month for Plaintiff. Finally, the order did not expressly impose upon either party responsibility for payment of the rather 47 N.T. 25. Defendant argues, however, that their agreement was more specific in that both parties agreed that Plaintiff would seek employment at a bakery as a cake decorator. N.T. 35. Plaintiff contends that she met the terms of their agreement regarding the purchase of the marital home because she was employed as a babysitter. N.T. 59. 48 N.T. 45. It does not appear that Plaintiff is willing to sell the property. 4~ Id. Order of Court, November 21, 1996. s~ See Domestic Relations Section - Conference Summary, dated January 21, 1997. 52 Order of Court, November 21, 1996; see Domestic Relations Section - Conference Summary, dated January 21, 1997. 9 NO. 96-1163 SUPPORT TERM substantial mortgage on the marital residence; it was the view of the Domestic Relations Office that the mortgage was basically an equitable distribution issue for resolution in the divorce action,s3 As noted, both parties have appealed from this order. DISCUSSION General The law relating to a support award is as follows: The monthly net income of the parties, for purposes of applying the guidelines, is to be determined as set forth in Pennsylvania Rule of Civil Procedure 1910.16-5(b), which provides in pertinent part: (b) Monthly Net Income. The amount of support to be awarded is based in large part upon the parties' monthly net income. Monthly net income is determined by subtracting only the following items from monthly gross income: (1) federal, state, and local income taxes; (2) F.I.C.A. payments and non- voluntary retirement payments; (3) union dues; (4) health insurance premiums for the benefit of the other party or the children. (5) alimony paid to the other party. The term "income" is defined in Section 4302 of the Domestic s3 See Domestic Relations Section Conference Summary, dated January 21, 1997. 10 NO. 96-1163 SUPPORT TERM Relations Code,s4 and generally encompasses income from any source. The pertinent statutory provision reads as follows: "Income." Includes compensation for services, including, but not limited to, wages, salaries, fees, compensation in kind, commissions and similar items; income derived from dealings in property; interest; rents; ~royalties; dividends; annuities; income from life insurance and endowment contracts; all forms of retirement; pensions; income from discharge of indebtedness; distributive share of partnership gross income; income in respect of a decedent; income from an interest in an estate or trust; military retirement benefits; railroad employment retirement benefits; social security benefits; temporary and permanent disability benefits; workmen's compensation and unemployment compensation. Pennsylvania Rule of Civil Procedure 1910.16-5(b) provides in part as follows: Monthly gross income is ordinarily based upon at least a six-month average of all of a party's income,s~ Defendant's Income. Defendant notes that his base salary for a 40-hour work week is $36,623. He suggests that a fair calculation of his income at this time would involve an averaging of his earnings over a period of the previous four years. The fact that part of one's usual income is from overtime does ~4 Act of October 30, 1985, P.L. 264, §1, as amended, 23 Pa. C.S. S4302. Pa. R.C.P. 1910.16-5(b) (emphasis added). 11 NO. 96-1163 SUPPORT TERM not, in itself, appear to operate as a reducing factor in the attribution of income for purposes of support. An attempt to factor into an income calculation whether a person works "too much" would introduce an element of uncertainty into the support law which would be incompatible with the primary purpose of the guidelines. Similarly, the fact that overtime is not an absolute certainty should not prevent its inclusion in one's putative income, where a pattern of overtime has developed. Cf. Fichthorn v. Fichthorn, 368 Pa. Super. 305, 533 A.2d 1388 (1987) (pattern of bonuses). On the other hand, unrecurring overtime is not a fair basis for a projection of income. See Grandovic v. Grandovic, 387 Pa. Super. 619, 564 A.2d 960 (1989) (semble). In the present case, the court calculated Defendant's net income/earning capacity on the basis of his earnings over the course of 1996. This period is twice the minimum period provided for in the rules; utilization of an even greater period, extending back four years, would not, in the court's view, have been a realistic approach to Defendant's present income status. In the process of calculation, the court excluded from Defendant's gross income those items, including some overtime, which it regarded as unrecurring, and deducted from gross income those items required under Rule 1910.16-5(b). 12 NO. 96-1163 SUPPORT TERM Plaintiff's Income. As a general rule, in a determination of a party's resources for purposes of support, the court must primarily focus on earning capacity rather than actual earnings.56 Pennsylvania Rule of Civil Procedure 1910.16-5(c)(5) provides that ordinarily a party who wilfully fails to obtain appropriate employment will be considered to have an income equal to the party's earning capacity. Age, education, training, health, work experience, earning history and child care responsibilities are factors which shall be considered in determining earning capacity. Defendant argues that Plaintiff's work history demonstrates that she has an earning capacity of $8.00 per hour. Defendant also contends that Plaintiff failed to present any compelling medical evidence that she has been debilitated by illness to the point that her earning capacity has been substantially limited. While the guidelines generally base the amount of support on actual net income, the court may nevertheless view earning capacity as the primary focus in determining ability to pay support, at least where the question of one's earning capacity is raised.57 However, despite Defendant's contention that Plaintiff failed to present convincing evidence regarding her medical condition's 56 (1993). 57 (1994). Perlberger v. Perlberger, 426 Pa. Super. 245, 626 A.2d 1186 Klahold v. Kroh, 437 Pa. Super. 150, 155, 649 A.2d 701, 703 13 NO. 96-1163 SUPPORT TERM effect on her ability to earn an income, we find Plaintiff's testimony regarding the debilitating effects of her cancer and treatments to be persuasive. Therefore, we do not believe that Plaintiff has wilfully failed to obtain appropriate employment. Thus, we find that Plaintiff's current earning capacity is equivalent to the amount she presently receives from babysitting. Having determined the monthly net income/earning capacity of each party, we will proceed to calculate the amount of child support and spousal support provided for by the guidelines in Pennsylvania Rule of Civil Procedure 1910.16. Support Guideline Computation Child Support. The net monthly income/earning capacity of Defendant is $3512, and the net monthly income/earning capacity of Plaintiff is $485, for a combined total of $3997. In accordance with the chart provided in Rule 1910.16-3(b), the parties' proportion of net monthly income spent on their child is 14.5%. The total child support is $580 a month. Of this amount, Defendant pays 87% and Plaintiff pays 13%. Therefore, Defendant is to pay 87% of $580 a month or approximately $505 a month in child support. Plaintiff is to pay 13% of $580 or approximately $75 a month in child support. Spousal Support. net income/earning income/earning The difference between Defendant's monthly capacity and Plaintiff's monthly net capacity, minus Defendant's child support 14 NO. 96-1163 SUPPORT TERM obligation, is $2520. According to the formula provided in Rule 1910.16-3(a), we multiply this amount by 30% to arrive at Defendant's spousal support obligation of $755. Totaling Defendant's child and spousal support obligations, Defendant's total support obligation each month as suggested by the guidelines is $1260. Marital Home Mortqage Pennsylvania Rule of Civil Procedure 1910.16-5(g) provides as follows: Mortgage Palrment. The guidelines assume that the spouse occupying the marital residence will be solely responsible for the mortgage payment, real estate taxes, and homeowner's insurance, unless there are unusual circumstances such as an unusually high mortgage payment. Similarly, the recommendation of the hearing officer or conference officer will assume that the party occupying the marital residence will be paying the items listed unless the recommendation specifically provides otherwise. As observed by President Judge Sheely of this court, "[w]hen applying for a mortgage most banks today allow for a 25 percent to 27 percent of income as a housing allowance." Bear v. Bear, No. 52 Support 1990, slip. op. at 4 (November 6, 19990) (Cumberland County). The monthly mortgage obligation of over $1500 on the parties' marital residence, now occupied by Plaintiff, is far in excess of what her earnings, and child and spousal support as calculated above, would accommodate under the formula indicated by Judge Sheely. It is, clearly, "an unusually high mortgage 15 NO. 96-1163 SUPPORT TERM payment." The parties are apparently unable to agree on whether the house should be sold, with Plaintiff preferring to continue her residence on the premises. She seeks child and spousal support beyond that produced by the guidelines - a substantial departure from the guidelines - to facilitate this choice. Defendant argues against such a deviation. A decision as to whether a deviation from the support guidelines should occur in a given case is within the sound discretion of the court. Sanders v. Lott, 428 Pa. Super. 119, 630 A.2d 438 (1993). In this case, the court does not believe that a departure is appropriate. The court does not read the portion of Rule 1910.16-5 quoted above as mandating a deviation in all cases where "an unusually high mortgage payment" exists. By its terms, the rule clarifies the premise that support calculated under the guidelines incorporates a reasonable housing allowance; the rule also can be read as protecting a support obligee from the assumption that a support obligor's responsibility on unusually high joint mortgage payments will be met inter se by the mere payment of support in accordance with the guidelines. In the present case, where a divorce action is pending between the parties, offering the possibility of special relief upon petition in connection with expenses related to marital property, 16 NO. 96-1163 SUPPORT TERM and where a reasonable dispute exists as to whether the marital residence should be retained in light of the unusually high mortgage payments associated with it and the parties' separation into two households, the court is of the view that a support order which expressly protects Plaintiff against the assumption that she is bearing more than a reasonable portion of the mortgage payment in light of her circumstances,~8 while not inflating Defendant's ~child and spousal support obligation to accommodate Plaintiff's choice of residence, would be proper. For all of the foregoing reasons, the following order will be entered: ORDER OF COURT AND NOW, this 23rd day of April, 1997, upon consideration of both parties' appeals from the order of court dated November 21, 1996, following a hearing and for the reasons stated in the accompanying opinion, and based upon the Court's determination that Plaintiff's monthly net income/earning capacity is $485 and that Defendant's monthly net income/earning capacity is $3512, it is hereby ordered that Defendant pay to the Domestic Relations Section, Court of Common Pleas, $1260 a month payable $315/week effective October 25, 1996, allocated $190 for spousal support and $125 for child support. THIS ORDER is for the support of Defendant's spouse, Teresa A. ~8 In accordance with the observation of President Judge Sheely in Bear v. Bear, No. 52 Support 1990 (November 6, 1990) (Cumberland County), that figure will be set at $435 per month. 17 NO. 96-1163 SUPPORT TERM Bauer, and one child, Angela Marie Bauer (d.o.b. August 21, 1987). DEFENDANT having been given credit in the order appealed from for direct payments totaling $1452, and no issue having been made of this credit at the hearing, the court will do likewise in this order. Any arrearages due shall be paid within 60 days of the date of this order. UNREIMBURSED medical expenses are to be paid 87% by Defendant and 13% by Plaintiff. Defendant shall provide medical insurance coverage through his employer. THE TERMS of the order of November 21, 1996, not inconsistent herewith are incorporated herein by reference. BY THE COURT, Cindy S. Conley, Esq. 130 Walnut Street P.O. Box 810 Harrisburg, PA 17108 Attorney for Plaintiff Barbara Sumple-Sullivan, Esq. 549 Bridge Street New Cumberland, PA 17070 Attorney for Defendant : rc s/ J. Wesley Oler, Jr. J. Wesley Oler, Jr., J. 18