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HomeMy WebLinkAbout452 S 2012 KATHERINE YOUNG, : IN THE COURT OF COMMON PLEAS OF Plaintiff : CUMBERLAND COUNTY, PENNSYLVANIA : V. : NO. 452 SUPPORT 2012 : DARYL L. YOUNG, : PACSES NO: 423113274 Defendant : IN RE: DEFENDANT’S EXCEPTIONS TO SUPPORT MASTER’S DECISION ORDER OF COURT th AND NOW this 10day of July, 2015, upon consideration of Defendant’s Exceptions, the briefs filed by the parties, and after argument and the Court noting that the record is not clear in this matter; IT IS HEREBY ORDERED AND DIRECTED that this matter is remanded to the Support Master for a new hearing. The parties are directed to bring to the Hearing: 2014 tax returns; all checking account/bank statements for 2013-present; any/all credit card statements from 2013-present. By the Court, ______________________ M. L. Ebert, Jr., J. Hannah F. Herman-Snyder, Esquire Attorney for Plaintiff Taylor P. Andrews, Esquire Attorney for Defendant Jeff R. Lawrence, Esquire Support Master DRO KATHERINE YOUNG, : IN THE COURT OF COMMON PLEAS OF Plaintiff : CUMBERLAND COUNTY, PENNSYLVANIA : V. : NO. 452 SUPPORT 2012 : DARYL L. YOUNG, : PACSES NO: 423113274 Defendant : IN RE: DEFENDANT’S EXCEPTIONS TO SUPPORT MASTER’S DECISION OPINION AND ORDER OF COURT Ebert, J, July 10, 2015 – Daryl L. Young, Defendant in the above-captioned matter, filed a petition for 1 modification of an existing support order on August 29, 2014. A support conference was held on October 1, 2014. Upon conclusion of the support conference, Defendant was ordered to pay $44.00 per month in support. Katherine Young, Plaintiff in the above-captioned matter, requested a de novo hearing before the Support Master. A support hearing was held on November 24, 2014. Following the support hearing, the Support Master made the following Recommendations: A. Father shall pay to the Pennsylvania State Collection and Disbursement Unit as support for his children, Willow B. Young, born August 11, 2004, Sawyer L. Young, born June 16, 2006, and Gavin C. Young, born January 18, 2009, the sum of $818.57 per month. B. Father shall pay to the Pennsylvania State Collection and Disbursement Unit the additional sum of $81 per month on arrears. C. Mother shall provide medical support for the benefit of the children as is available to her through employment or other group coverage at a reasonable cost. D. The monthly support obligation includes cash medical support in the amount of $250.00 annually for unreimbursed medical expenses incurred 1 Under the previous support order dated July 11, 2014, Defendant’s child support obligation was set at $459 per month. 2 for the children. Unreimbursed medical expenses of each child that exceed $250.00 annually shall be allocated between the parties. The party seeking allocation of unreimbursed medical expenses must provide st documentation of expenses to the other party no later than March 31 of the year following the calendar year in which the final medical bill to be allocated was received. The unreimbursed medical expenses are to be paid as follows: 68% by Father and 32% by Mother. 2 E. The effective date of this order is August 29, 2014. Defendant filed Exceptions to the Support Master’s Decision on January 7, 2015. Defendant’s Exceptions are as follows: 1. The Master’s Finding of Fact #4 is in error by being incomplete and misleading. The child support ordered on July 11, 2014 included health insurance expenses totaling $650 per month with Wife paying the premium. This order was adjusted in September 2014 when the health insurance cost was reduced and shared and the child support ordered to be paid by Defendant was then reduced to $43.89 per month. 2. The Master’s Finding of Fact #19 that the Defendant purchased a home without a mortgage is in error because the record indicates that there is a mortgage on Defendant’s residence for which Defendant pays $740.98 per month. 3. The Master’s Finding of Fact #23 regarding Defendant’s expenses is in error in that the stated amount of $3,553.50 includes business expenses that are paid from the gross income of Defendant’\[s\] business. 4. It was error in this case for the Master to attribute to Defendant an earning capacity that greatly exceeds Defendant’s actual earnings when the Defendant has engaged in the same business with relatively constant income for more than 25 years and there is no finding that the Defendant has willfully failed to obtain or maintain appropriate employment as per PA R.C.P. 1910.16(d)(4). 5. It was error in this case for the Master to use the total of $3,553.50 as Defendant’s monthly expenses that indicated Defendant’s actual income when the total included business expenses that were paid from the gross income of Defendant’s business, and where Defendant incurred 3 substantial debt to pay the expenses. 2 Support Master’s Report and Recommendation, filed Dec. 19, 2014 3 Defendant’s Exceptions to Support Master’s Decision, filed Jan. 7, 2015 3 Discussion Plaintiff is currently receiving unemployment compensation in the amount of $284 per week. She also receives $78 per week from the Bair Foundation for working two foster care cases part-time. The Support Master assessed Plaintiff with a monthly earning capacity of $1,668.86. Defendant is self-employed and performs home improvement and remodeling work. The Support Master did not use the income reported on Defendant’s most recent tax return, but rather looked to his current expenses and previous methods of deriving income. Defendant testified to average monthly expenses of $3,553.50, which the Support Master used to determine Defendant’s net monthly earning capacity of $3,600. Using the above monthly earning capacities, the Support Master calculated Defendant’s share of the support to be $1,103.53. This value was adjusted downward to $782.79 because the parties share custody equally. Defendant’s payments were then adjusted upward to $818.57 because Defendant’s proportional share of the daycare expenses was higher than Plaintiff’s. In making his recommendation, the Support Master made several findings of fact regarding the Defendant’s income, including: 19. Father used that money \[from equitable distribution\] to purchase a 4 home without a mortgage. 22. Father’s net profit, as reported on his federal income taxes from 2011 to 2013, has averaged $26,734. 23. Father has monthly bills of $3,553.50; he stays current on those payments in part by using credit cards. 4 This finding of fact is in error as Defendant stated on the record that he has a mortgage in the amount of $740 per month. This is also reflected in the few checking account statements attached as Plaintiff’s Ex. 8. 4 24. Father then pays as much as he can towards credit card debt each month; he estimates those payments are between $800 and $2,500 per month. 25. In 2014 Father’s credit card debt has increased by approximately 5 $19,000. The Support Master also noted that when the parties were together they would regularly accumulate credit card debt and then pay it off when Defendant had more work. The Support Master concluded that Defendant was replicating this system and assumed Defendant would be paying off the approximately $19,000 later on. In his exceptions and brief, Defendant takes issue with the fact that the Support Master did not take the credit card debt into account. After reviewing the record, there is no evidence to support the assumption that Defendant has the ability to pay off the $19,000 in credit card debt or whether the purchases on Defendant’s credit cards were in fact, personal expenses. The court should look to the actual disposable income of a party when determining support, especially in a situation where a party is self-employed. See Labar v. Labar, 731 A.2d 1252,1255 (Pa. 1999). Obviously, if Defendant is unable to pay off the credit card that he uses to purchase some of his basic expenses, this would produce a difference in the actual disposable income available to him. The record remains unclear as to whether Defendant has actually incurred these expenses sufficient to include them as part of his income for support purposes. A review of Defendant’s credit card statements and checking account statements for the relevant time period is necessary to determine the significance of Defendant’s credit card debt on his monthly income. 5 Support Master’s Report and Recommendation, filed Dec. 1, 2014 5 Defendant does not appear to take issue with the fact that the Support Master looked to his expenses rather than the income reflected on his tax return. However, Defendant argues that the Support Master should not have included Defendant’s mixed business and personal expenses in calculating his income. These expenses included Defendant’s cell phone bill and expenses related to his truck, totaling $1,054. As the record was clear that Defendant uses these items for business purposes, this Court agrees that these expenses should not be considered as solely personal expenses when re-calculating Defendant’s income for support purposes. While certainly Defendant may realize some benefit by claiming these expenses as business expenses, this does not appear to be the type of situation where a defendant is commingling personal and business funds in one bank account and living luxuriously by eating out at restaurants every night, purchasing tickets to shows, and going on numerous trips. Furthermore, any significance, if any, the Support Master placed on the fact that Defendant is no longer fixing up the home he lives in to sell for a profit, is misplaced. Defendant testified that practice occurred when Plaintiff and Defendant were an intact family unit and Defendant had more support in the home. Defendant also testified that he currently would not be able to receive the same credit in order to finance this practice and he wants to use his free time to spend with his children. It would not be realistic to expect Defendant to continue this practice indefinitely. This Court finds that this case needs to be remanded for a new support hearing, based in part on the large discrepancy between the amount of support calculated at the support conference and the amount calculated by the Support Master at the de novo hearing. At this time, the record is incomplete and needs to be developed further, 6 especially in relation to the $19,000 in credit card debt incurred by Defendant to pay some of his monthly expenses. Accordingly, the following order will be entered: ORDER OF COURT th AND NOW, this 10 day of July, 2015, upon consideration of Defendant’s Exceptions, the briefs filed by the parties, and after argument and the Court noting that the record is not clear in this matter; IT IS HEREBY ORDERED AND DIRECTED that this matter is remanded to the Support Master for a new hearing. The parties are directed to bring to the Hearing: 2014 tax returns; all checking account/bank statements for 2013-present; any/all credit card statements from 2013-present. By the Court, ______________________ M. L. Ebert, Jr., J. Hannah F. Herman-Snyder, Esquire Attorney for Plaintiff Taylor P. Andrews, Esquire Attorney for Defendant Jeff R. Lawrence, Esquire Support Master DRO 7