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HomeMy WebLinkAbout00-0123 SupportANN E. HELLRUNG, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA DOMESTIC RELATIONS SECTION CIVIL ACTION - SUPPORT JAMES D. HELLRUNG, Defendant NO. 00-0123 SUPPORT IN RE: DEFENDANT'S PETITION FOR MODIFICATION OF AN EXISTING SUPPORT ORDER and PLAINTIFF'S APPEAL FROM THE RESULTANT RECOMMENDED SUPPORT ORDER BEFORE OLER~ J. OPINION and ORDER OF COURT OLER, J., July 26, 2001. In this child support case, Plaintiff mother has appealed from an order of court recommended by the Domestic Relations Office~ following a Domestic Relations Office conference.2 The conference resulted from a petition to modify filed by Defendant father.3 The petition to modify was based upon a decrease in Defendant's income, due to loss of his employment.4 As a consequence of Plaintiff's appeal, a de novo hearing before this court was held on Defendant's petition to modify on June 22, 2001.5 At the conclusion of the hearing, the court took the matter under advisement.6 The issue presented by the case is whether the court should incorporate in the support order certain terms of a prior child support agreement between the parties, ~ See Order of Ct., April 4, 2001. 2 See Pa. R.C.P. 1910.11. 3 See Pet. Modification Existing Support Order, filed Feb. 9, 2001. 4 Id. Defendant's position apparently was eliminated by his employer. See id.; N.T. 4, Hr'g, June 22, 2001 (hereinafter N.T. ~. 5 See Pa. R.C.P. 1910.11(i). 6 Order of Ct., June 22, 2001. notwithstanding their inconsistency with the support guidelines.7 For the reasons stated in this opinion, the issue will be resolved in the negative. STATEMENT OF FACTS Plaintiff is Ann E. Hellrung, 43.8 Defendant is James D. Hellrung, 46.9 The parties were married on September 5, 1981.~° Two children were born of the parties' marriage: Matthew P. Hellrung, born February 6, 1984, and Amanda J. Hellrung, born May 11, 1986.~ The parties separated in August of 1995, and were divorced on May 8, 1996.~2 Both parties presently live in Cumberland County, Pennsylvania.~3 Plaintiff mother is a pharmaceuticals salesperson and has a net monthly income/earning capacity of $4,914.59.TM Defendant father is an unemployed industrial engineer and has a net monthly income/earning capacity of $1,551.60. ~5 On April 18, 1996, prior to the entry of the divorce decree, the parties entered into a marital settlement agreement (hereinafter the Agreement), which included provisions relating to custody and child support. 16 With respect to custody, the Agreement provided 7 See N.T. 3-5. The support guidelines have been promulgated as Pennsylvania Rules of Civil Procedure 1910.16-1 to -7. 8 N.T. 8, 11. 9 N.T. 8, 28. l0 N.T. 8. ~ N.T. 9. ~2 N.T. 8. ~3 N.T. 12, 28. 14 N.T. 9, 15. ~5 N.T. 9, 30. 16 Pl.'s Ex. 2-A, Hr'g, June 22, 2001 (hereinafter Pl.' s Ex. ~). 2 that Plaintiff mother would be primary physical custodian of the children,17 a status which she still occupies,la With respect to child support, paragraph 33 of the Agreement provided as follows: HUSBAND shall pay Seven Hundred Fifty ($750.00) Dollars per month for the support of the parties' two children. HUSBAND further agrees to forward said check directly to WIFE so that she receives it on or before the 7th day of each month. Should WIFE fail to receive her monthly child support check by the 7th day of any month, WIFE shall, at her option, commence a support action through the Domestic Relations Officer of the county in which she resides and HUSBAND shall agree to a wage attachment. HUSBAND'S support obligation shall commence on the month immediately following the month in which he makes his last mortgage payment on the marital home. HUSBAND'S obligation shall continue pursuant to Paragraph 34 of this Agreement [relating to higher education expenses of the children], notwithstanding current support law. HUSBAND shall provide health insurance coverage for the benefit of the children so long as he is obligated to contribute to their support pursuant to the provisions of this Agreement. The parties agree that each shall be equally responsible for all uninsured medical and/or dental expenses of the children. In the event that neither party is provided with employer health insurance coverage for the children, each agrees to divide equally the cost of providing such health insurance coverage. WIFE agrees that HUSBAND shall be entitled to claim the deduction for the dependency exemption for the parties son, Matthew Hellrung, each and every year commencing with the 1996 tax year. WIFE further agrees to execute Internal Revenue Service Form 8332 or any other declaration required to implement this paragraph. 19 Paragraph 5, which dealt with enforcement of the Agreement, provided, in pertinent part, as follows: [T]his Agreement may be enforced to the same extent as though it had been an Order of the Court, and the parties hereby expressly invoke and acknowledge the applicability of Section 3105 of the Pennsylvania Divorce Code in furtherance hereof.2° 17 Pl.'s Ex. 2-A para. 32. la N.T. 9. 19 Pl.'s Ex. 2-A para. 33. 20 Pl.'s Ex. 2-A para. 5. On May 8, 1996, this court entered a decree divorcing the parties. The decree incorporated the Agreement "for enforcement purposes only pursuant to Section 3105 of the Pa Divorce Code.''2~ On April 23, 1997, in the divorce action, Plaintiff filed a petition to enforce the terms of the Agreement with respect to Defendant's obligation to pay child support, provide health insurance for the children, and reimburse Plaintiff for 50% of uninsured medical costs.22 After finding that Defendant was "in substantial compliance" with the terms of the Agreement, the court dismissed the petition.23 On October 10, 1997, again in the divorce action, Defendant filed a petition to decrease the level of child support, based on an allegation that Plaintiff was no longer incurring expenses related to summer camp for the children.24 Plaintiff filed a counterclaim for contempt, alleging that Defendant had failed to provide health insurance for Amanda J. Hellrung, pursuant to the Agreement.25 Both the petition and counterclaim were resolved through the instrument of an addendum to the Agreement, whereby Plaintiff agreed to provide health insurance for both children through her employer on the condition that Defendant would compensate Plaintiff $15.00 per month for the cost of the insurance.26 2~ See Decree in Divorce, Hellrung v. Hellrung, No. 95-4298 (Ct. Com. Pl. Cumberland County May 8, 1996). 22 Pet. Enforce Property Settlement Agreement, filed April 23, 1997, para. 8, Hellrung, No. 95-4298. 23 Order of Ct., June 3, 1997, Hellrung, No. 95-4298 (Hess, J.). 24 See Pet. Modify Support, filed Oct. 10, 1997, Hellrung, No. 95-4298. 25 See Answer with Countercl. Pet. Modify Support, filed Nov. 14, 1997, Hellrung, No. 95-4298. 26 Pl.'s Ex. 3 paras. 2, 4. 4 On April 24, 1999, Defendant lost his job; however, he received a severance package and drew unemployment compensation.27 According to Plaintiff, at the end of December, 1999, Defendant ceased paying child support.28 On January 4, 2000, again in the divorce action, Defendant filed a petition to modify support based on changed circumstances resulting from his loss of employment.29 Plaintiff filed a counterclaim for contempt, alleging that Defendant had failed to reimburse Plaintiff for unreimbursed medical expenses and legal fees and costs.3° Both the petition and counterclaim were withdrawn by the parties following an agreement to proceed through the Domestic Relations Office.3~ On February 15, 2000, Plaintiff filed a complaint for support with the Domestic Relations Section of this court.32 Following a Domestic Relations Office conference, a recommended order was entered by the court, pursuant to an agreement of the parties.33 The order indicated that Plaintiff's net monthly income was $3,871.99 and that Defendant's monthly net income was $1,147.64.34 Among the premises upon which net incomes were calculated was that each party would claim one child as an exemption for income tax purposes, in accordance with their practice.35 27 N.T. 17, 30. 28 N.T. 17. 29 See Pet. Modify Support, filed Jan. 4, 2000, Hellrung, No. 95-4298. 3o See Answer with Countercl. Pet. Modify Support, filed Jan. 18, 2000, Hellrung, No. 95-4298. 3~ See Praecipe Withdraw Pet. Modify Support, filed March 7, 2000, Hellrung, No. 95- 4298; Letter from Charles Rector, as counsel for Ann E. Hellrung, to Kevin A. Hess, J., of March 8, 2000, Hellrung, No. 95-4298. 32 Compl. Support, filed Feb. 15, 2000; N.T. 17. 33 Order of Ct., March 22, 2000. The order noted that it was "based on the parties agreement." Id 34 Id. 35 The calculation of the parties' net incomes is attached to this opinion as Appendix A. This premise effectively increased Defendant's net income for purposes of child support calculations. The assignment of both exemptions to Plaintiff, the custodial parent, would The order required Defendant to pay child support in the amount of $326.00 per month, required Plaintiff to provide medical insurance coverage36 and to pay the first $250.00 of unreimbursed medical expenses, and required each party to pay half of the children's unreimbursed medical expenses over $250.00.37 This recommended order was not appealed by either party. On April 23, 2000, Defendant obtained new employment.38 On May 5, 2000, Plaintiff filed a petition to modify the child support order based on changed circumstances, primarily in the form of Defendant's resumption of employment.39 Following a Domestic Relations Office conference, a recommended order was entered by the court, pursuant to an agreement of the parties.® The order indicated that Plaintiff's net monthly income was $3,941.74, and that Defendant's net monthly income was $3,689.46.41 Among the premises upon which net incomes were calculated was that each party would claim one child as an exemption for income tax purposes, in accordance with their practice.42 have diminished Defendant's net income (for purposes of the calculation) by withdrawing the direct tax benefit of the exemption and withdrawing the incidental tax benefit of head-of-household status. Treas. Reg. § 1.2-2(b) (1971). ,6 Subject to reimbursement by Defendant in accordance with the parties' respective net incomes. 37 Order of Ct., March 22, 2000. The calculation of support is attached to this opinion as Appendix A. The order also contemplated a payment of $3,032.99 by Defendant for prior unreimbursed medical expenses. Id 38 N.T. 30-31. 39 Pet. Modification Existing Support Order, May 5, 2000. Plaintiff had also changed employment. Id.; N.T. 30-31. 40 Order of Ct., July 19, 2000. The order noted that it was "based on the parties agreement." Id. 4~ Id. 42 The calculation of the parties' net incomes is attached to this opinion as Appendix B. As previously noted, this premise effectively increased Defendant's net income for purposes of child support calculations. The assignment of both exemptions to Plaintiff, the custodial parent, would have diminished Defendant's net income (for purposes of the This order required Defendant to pay child support in the amount of $1,012.00 per month, required Plaintiff to provide medical insurance coverage43 and to pay the first $250.00 of unreimbursed medical expenses, and required each party to pay half of the unreimbursed medical expenses over $250.00.44 This recommended order was not appealed by either party. On February 9, 2001, Defendant lost his employment again, because of a downturn in the employer's business.45 On that date, he filed a petition to modify the child support order, based on changed circumstances in the form of his loss of employment.46 Following a Domestic Relations Office conference, and in the absence of an agreement of the parties, a recommended order was entered by the court in accordance with the support guidelines on April 4, 2001.47 The order indicated that Plaintiff's net monthly income was $4,914.59, and that Defendant's net monthly income was $1,551.60.48 Among the premises upon which the net incomes were calculated was that each party would claim one child as an exemption for income tax purposes, in accordance with their practice.49 calculation) by withdrawing the direct tax benefit of the exemption and withdrawing the incidental tax benefit of head-of-household status. Treas. Reg. § 1.2-2(b) (1971). 43 Subject to reimbursement by Defendant in accordance with the parties' respective net incomes. 44 Order of Ct., July 19, 2000. The calculation of support is attached to this opinion as Appendix B. The order also noted that Defendant owed $3,149.90 for unreimbursed medical expenses to date. Id. 45 N.T. 31-32. 46 Pet. Modification Existing Support Order, Feb. 9, 2001. 47 Order of Ct., April 4, 2001. 48 Jcl. 49 Jcl. The calculation of the parties' net incomes is attached to this opinion as Appendix C. As previouisly noted, this premise effectively increased Defendant's net income for purposes of child support calculations. The assignment of both exemptions to Plaintiff, the custodial parent, would have diminished Defendant's net income by withdrawing the direct tax benefit of the exemption and withdrawing the incidental tax benefit of head-of- household status. Treas. Reg. §1.2-2(b) (1971). This order required Defendant to pay child support in the amount of $427.08 per month and required Plaintiff to provide medical insurance coverage5° and to pay the first $250.00 of unreimbursed medical expenses. It also required the parties to pay unreimbursed medical expenses over $250.00 in proportion to their respective net incomes (i.e., 74% for Plaintiff and 26% for Defendant).5~ From this recommended order, Plaintiff filed an appeal to this court on or about April 12, 2001. Her position on the appeal was that the order should reflect the terms of the Agreement, and amendment to the Agreement, at least to the extent of requiring Defendant to pay the entire cost of medical insurance coverage and to pay half the cost of unreimbursed medical expenses.52 At the hearing on the matter, Plaintiff did not suggest a departure from the premise and practice whereby each party was claiming one child as an 53 exemption for income tax purposes. DISCUSSION Statement of Law Section 3105 of the Divorce Code addresses the effect of a marital settlement agreement between parties, under the present circumstances, in actions for child support: (a) Enforcement.--A party to an agreement[,] . . . whether or not the agreement has been merged or incorporated into [a divorce] decree, may . .. enforce the agreement to the same extent as though the agreement had been an order of the court except as provided to the contrary in the agreement. (b) Certain provisions subject to modification.--A provision of an agreement regarding child support, visitation or custody shall be subject to modification by the court upon a showing of changed circumstances. 50 Subject to reimbursement by Defendant in accordance with the parties' respective net incomes. 5~ Order of Ct., April 4, 2001. The calculation of support is attached to this opinion as Appendix C. 52 N.T. 4-6. 53 N.T. 20-21, 25-27, 35-36. Act of December 19, 1990, P.L. 1240, No. 206, 32, 23 Pa. C.S.A. § 3105 (West 1996 & Supp. 2001). The child support provisions of such a marital settlement agreement are treated as a court order and the trial court may grant either an increase or a reduction in the level of child support based on a showing of changed circumstances. Nichols'on v. Combs, 550 Pa. 23, 31-32, 703 A.2d 407, 411 (1997); Peck v. Peck, 707 A.2d 1163, 1167 (Pa. Super. Ct. 1998); Patterson v. Robbins, 703 A.2d 1049, 1051 (Pa. Super. Ct. 1997). But see McMichael v. McMichael, 700 A.2d 1337, 1339 (Pa. Super. Ct. 1997) (interpreting § 3105(b) to allow for only upward modification in child support orders).54 Pennsylvania Rule of Civil Procedure 1910.1 provides, in pertinent part, as follows: (a) Except as provided by subdivision (b), the rules of this chapter govern all civil actions or proceedings brought in the court of common pleas to enforce a duty of support .... (b) The rules of this chapter shall not govern (1) an action or proceeding for support based upon a contract or agreement which provides that it may not be enforced by an action in accordance with these rules .... Pa. R.C.P. 1910.1. Agreements relating to matters of child support are "to be treated as orders for the purposes of enforcement unless the agreement provides otherwise." Pa. R.C.P. 1910.1 explanatory cmt.-1994. In the absence of an agreement by the parties to the contrary, or an authorized basis for deviation, a court should adhere to the support guidelines (Rules 1910.16-1 to - 54 The Court in McMichael, which concluded that § 3105(b) allows a court only to increase the amount of child support in a settlement agreement, relied on the Superior Court decision in Nicholson v. Combs, 437 Pa. Super. 334, 650 A.2d 55 (1994), a decision which was reversed in part by the Pennsylvania Supreme Court in 1997. Nicholson, 550 Pa. at 31-32, 703 A.2d at 411. The courts in Peck and Patterson, which concluded that § 3105(b) allows the court to increase or decrease the amount of support, relied on the Pennsylvania Supreme Court decision in Nicholson. Peck, 707 A.2d at 1167; Patterson, 703 A.2d at 1051. Thus, in this court's view, the latter two cases are arguably of more precedential value than McMichael. 7) in fashioning the terms of child support orders. Pa. R.C.P. 1910.1 l(f). "The clear intent of the guidelines . . . was to do away with individual, case-by-case determinations [of child support] .... "Ball v. Minnick, 538 Pa. 441, 452, 648 A.2d 1192, 11971994). This approach provides an efficient method for resolution of support actions while protecting the best interests of the children. Id. at 452, 648 A.2d at 1197; see also 23 Pa. C.S.A. §4322(a). The support guidelines provide for the court's determination of each party's net monthly income and an application of formulas provided in the chapter to these figures to find the presumptive child support obligation. Pa. R.C.P. 1910.16-2 to -4. In this regard, the court is expected to include the effect of tax exemptions the party may claim in computing net monthly income. Pa. R.C.P. 1910.16-2(c)(1)(A). The amount derived from the support guidelines is presumed to be the correct amount. Minnick, 538 Pa. at 452, 648 A.2d at 1197. The court, however, may deviate from this amount for the reasons enumerated in Rule 1910.16-5, as follows: (1) unusual needs and unusual fixed obligations; (2) other support obligations of the parties; (3) other income in the household; (4) ages of the children; (5) assets of the parties; (6) medical expenses not covered by insurance; (7) standard of living of the parties and their children; (8) in a spousal support or alimony pendente lite case, the period of time during which the parties lived together from the date of marriage to the date of final separation; and (9) other relevant and appropriate factors, including the best interests of the child or children. Pa. R.C.P. 1910.16-5. The court is not expected to deviate from the amount of child support recommended by operation of the support guidelines formulas in the absence of one of these circumstances. McGinnis v. McGinnis, 439 Pa. Super. 372, 376-77, 654 A.2d 563, 565 (1995). "The existence of a prior private support agreement between the parties 10 is not one of the factors included in Rule 1910.16-4 as a permissible basis for departure from the guidelines." Id. at 377, 654 A.2d at 565 (emphasis added). Rule 1910.16-6, which governs the allocation of unreimbursed medical expenses between the parties in a support action, provides, in pertinent part, as follows: Unreimbursed medical expenses of the obligee or the children shall be allocated between the parties in proportion to their respective net incomes and obligor's share added to his or her basic support obligation. Pa. R.C.P. 1910.16-6(c). The obligee (i.e., the party receiving child support) "is expected to assume the first $250 per year of these expenses and may seek contribution under this Rule only for unreimbursed expenses which exceed $250 per year." Pa. R.C.P. 1910.16-6 explanatory cmt.- 1998. Finally, Rule 1910.16-6, which also governs the allocation of health insurance premiums, provides as follows: A party's payment of a premium to provide health insurance coverage on behalf of... the children shall be allocated between the parties in proportion to their net incomes .... Pa. R.C.P. 1910.16-6(b)(1). Application of Law to Facts Plaintiff initiated this action for support with the Domestic Relations Section of the court. In the Agreement, the parties did not provide that either §3105(b) of the Divorce Code or Pennsylvania Rule of Civil Procedure 1910.1 would not be applicable;ss therefore, the child support provisions of the Agreement, for present purposes, are to be treated as a court order, subject to modification based on a showing of changed circumstances. Although in the past some aspects of the Agreement have been incorporated into support orders, these incorporations have been the result of agreements by the parties. In the absence of such an agreement at the present time, the court's disposition of the case is 55 In fact, the parties "expressly invoke[d] Section 3105(b)." Pl.'s Ex. 2-A para.5. 11 governed by the rule that a deviation from the guidelines is generally not appropriate unless predicated upon one of the enumerated grounds for deviation in Rule 1910.16-5. No such ground for deviation has been shown. For these reasons, the court is constrained to dismiss Plaintiff s appeal from the order of court dated April 4, 2001, since the order was the result of a calculation of the parties' net incomes and an application of the guidelines in accordance with the Rules.56 ORDER OF COURT AND NOW, this 26th day of July, 2001, upon consideration of Defendant's Petition for Modification of an Existing Support Order, and of Plaintiff s appeal from the recommended order of court resulting from the petition, following a hearing, and for the reasons stated in the accompanying opinion, the petition is denied and the order of court dated April 4, 2001, shall remain in full force and effect. BY THE COURT, /s/J. Wesley Oler, Jr. J. Wesley Oler, Jr., J. Barbara Sumple-Sullivan, Esq. 549 Bridge Street New Cumberland, PA 17070-1931 Attorney for Plaintiff James D. Hellrung 3 Long Street Drive Carlisle, PA 17013 Defendant, Pro Se 56 Nothing herein is intended to express an opinion as to whether a private contract action could accomplish Plaintiff s objectives. 12 13 ANN E. HELLRUNG, Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA DOMESTIC RELATIONS SECTION Vo CIVIL ACTION - SUPPORT JAMES D. HELLRUNG, Defendant NO. 00-0123 SUPPORT ORDER OF COURT AND NOW, this day of July, 2001, upon consideration of Defendant's Petition for Modification of an Existing Support Order, and of Plaintiff's appeal from the recommended order of court resulting from the petition, following a hearing, and for the reasons stated in the accompanying opinion, the petition is denied and the order of court dated April 4, 2001, shall remain in full force and effect. BY THE COURT, Barbara Sumple-Sullivan, Esq. 549 Bridge Street New Cumberland, PA 17070-1931 Attorney for Plaintiff James D. Hellrung 3 Long Street Drive Carlisle, PA 17013 Defendant, Pro Se J. Wesley Oler, Jr., J.