FILED: April 20, 2005
IN THE COURT OF APPEALS OF THE STATE OF OREGON
In the Matter of the Marriage of
ROSE M. CROOK,
Rose M. Tankersley,
DWIGHT L. CROOK,
Appeal from Circuit Court, Washington County.
John B. Lewis, Judge.
Submitted on record and brief October 28, 2004.
David L. Rich filed the brief for appellant.
No appearance for respondent.
Before Landau, Presiding Judge, and Brewer, Chief Judge, and Leeson, Judge pro
LEESON, J. pro tempore
Reversed and remanded for recalculation of child support; otherwise affirmed.
*Leeson, J. pro tempore, vice Armstrong, J.
In this domestic relations proceeding, husband assigns error to the trial
court's denial of his motion to modify the underlying judgment of dissolution of marriage
by ordering wife to pay child support, the court's denial of his request for credit against
child support arrears for time that one of the children for whom he was required to pay
support was living with him, and its denial of his request to eliminate or substantially
reduce his spousal support obligation. On de novo review, ORS 19.415(3) (2001);
Albrich and Albrich, 162 Or App 30, 32, 987 P2d 542 (1999), we affirm in part, reverse
in part, and remand for recalculation of child support.
The parties were married in 1977. They had five children, born between
1978 and 1986. The parties' marriage was dissolved by a stipulated judgment of
dissolution entered January 7, 1997. Husband was then 43 years old and wife was 42
years old. Among other things, the judgment gave custody of the parties' four minor
children to wife, and it required husband to pay wife child support in the amount of
$1,285 per month, or $321.25 per child. The judgment also ordered husband to pay wife
spousal support in the amount of $1,500 per month for 15 years and awarded wife an
equalizing judgment of $300,000. (1) The worksheet attached to the judgment indicated
that husband's gross monthly income at the time was $7,500 and that wife's gross monthly
income was $0.
By the end of 1998, husband had lost his job as a reliability engineer at Intel
Corporation, and wife had remarried. The parties had ongoing disputes about husband's
failure to comply with the terms of the stipulated dissolution judgment.
On January 11, 1999, after the parties had negotiated resolution of the
support disputes that had arisen to that point, the court entered a "Stipulated Modification
of Judgment of January 7, 1997." The judgment recited that wife had remarried, that
three of the parties' minor children were then residing with wife, and that their other two
other children were attending school. The judgment also recited that husband's
employment had been terminated on November 13, 1998, and that he had not become re-employed. Furthermore, the judgment recited the parties' agreement that the presumptive
amount of child support husband was to pay to wife was "inappropriate and the presumed
amount is rebutted due to other income being available to the parties and [husband's]
belief that he can obtain comparable employment[.]" The judgment ordered husband to
continue to pay wife $1,285 per month in child support. It made no change to spousal
support, consistently with the parties' stipulation.
Rather than finding new employment or returning to school to update his
electrical engineering degree, husband decided to farm land that he and wife had owned
during their marriage. In December 1999, husband sold his interest in that land to Cigna,
a corporation in Belmopan, Belize, that husband had created for "asset protection."
Husband also sold all the Intel stock holdings that had been awarded to him in the
dissolution to Cigna in exchange for an annuity that is payable to him at age 65 from a
company named "Hampton," which apparently is a subsidiary of Cigna.
In June 2000, one of the parties' minor children began living with husband.
In October 2002, husband filed a motion to show cause seeking to modify the dissolution
judgment to award custody of that child to husband, to require wife to pay child support,
to grant husband a credit for child support arrearages, to change the parenting plan for
visitation, and to either terminate or substantially reduce his spousal support in amount
and duration. Wife requested production of a variety of documents from husband. His
failure to provide information and documentation caused his lawyer to withdraw, citing
husband's failure to cooperate.
In November 2002, the court entered a judgment of spousal and child
support arrearages against father in the amount of $12,817 for arrearages through
February 1, 2002. The following month, wife asked the court to hold husband in
contempt for failure to abide by the terms of the judgment. In April, husband's new
lawyer informed wife's counsel that husband had directed him not to produce or turn over
any of the documents that wife had requested.
The hearing on husband's motion to modify and wife's motion for contempt
was held on August 7, 2003. Husband testified at the hearing; wife appeared by
telephone. Husband submitted a copy of his 2001 federal income tax return, which stated
that his income for that year was $6,457 and that he had experienced a loss of $28,269 in
his farming operation, Beef and Berries.
After the hearing, the court found that husband's testimony established his
ability to provide for the minor child. It also found that husband had voluntarily stripped
himself of assets for "protection from creditors." Finally, it found that husband's failure
to produce records made it impossible to determine the accuracy of husband's assertion
that he lacked the ability to pay spousal support. The court awarded custody of one of the
parties' minor children to husband, consistently with the parties' stipulation; terminated
husband's support obligation for that child as of August 1, 2003; denied husband's request
for an order of child support against wife; denied husband credit for either child or
spousal support arrearage; and denied husband's request to terminate spousal support.
We begin with husband's assignment of error concerning spousal support.
Husband contends that the trial court erred in either not terminating spousal support or
substantially modifying husband's spousal support obligation. According to husband, a
substantial change in circumstances entitled him to at least a substantial reduction in the
amount and duration of spousal support. He points to his layoff from Intel and the fact
that, by the time of the modification hearing, he was earning less than minimum wage and
had to make withdrawals from his Individual Retirement Account (IRA) to pay his living
expenses. Husband faults wife for putting on no evidence to rebut his testimony at the
hearing and asserts that "there is a reasonable inference that her current standard of living
does not depend upon her receipt of this support." (2) Husband contends that "it can no
longer be said to be 'just and equitable' to continue to require the support payment[.]"
An award of spousal support may be modified based on a finding that there
has been a substantial, unanticipated change in circumstances since the time of the earlier
award. ORS 107.135(3)(a); Hutchinson and Hutchinson, 187 Or App 733, 739, 69 P3d
815 (2003). The burden of establishing a change of circumstances is on the party
requesting the change. Thomas and Thomas, 181 Or App 128, 131, 45 P3d 954 (2002).
The change in circumstances must be one that could not have been anticipated at the time
of the earlier judgment. Thomsen and Thomsen, 167 Or App 218, 223, 2 P3d 432 (2000).
If the requisite change in circumstances is established, then the overriding consideration
in determining the appropriate amount of spousal support is what is just and equitable
under the circumstances. Hutchinson, 187 Or App at 739.
In this case, the relevant judgment for purposes of analyzing husband's
argument regarding change of circumstances is the "Stipulated Modification of Judgment
of January 7, 1997," which was entered on January 11, 1999. At that time, husband had
been laid off from Intel, but he acknowledged that he had "other income," and he did not
seek a reduction in his spousal support obligation. The question, then, is whether
husband has established that there was a substantial, unanticipated change in
circumstances between entry of that stipulated modification of judgment and his motion
to terminate or substantially reduce his spousal support obligation. He has not.
Husband's first argument regarding change of circumstances is his layoff
from Intel. However, that layoff had occurred before the modification in 1998, and
husband stipulated in the modified judgment that he had "other income." Husband also
points to his "offshore investment scheme," which he now claims proved to be
"foolhardy" and contends that his only remaining asset is his IRA. However, as noted,
husband refused to produce any records or documentation to support his claims. A
review of the transcript of the hearing indicates that husband, through Cigna, may own a
mobile home park and a house in Mexico, receive income for managing property in
Oregon for Cigna, and have money available to him through a Cigna credit card. As the
moving party, husband failed to establish an unanticipated change in economic
circumstances. The trial court did not err in denying husband's motion to terminate
We turn to husband's assignment of error concerning child support for the
child residing with him. On the Uniform Support Affidavit that wife filed in this matter,
she stated that she receives no monthly income from employment and has no occupation.
She also reported income of $800 per month from "contract payments." The trial court
found that husband had the financial ability to support the child and denied his request
that wife be ordered to pay child support.
Husband contends that the trial court erred by not finding that wife can be
gainfully employed on a full-time basis and attributing to her an earning potential
consistent with the requirements of the guidelines. Husband is correct. Under ORS
25.270 and OAR 137-050-0330, the guidelines for computing individual child support
obligations, a court is required to determine the presumptive amount of child support.
OAR 137-050-0360(1) creates a rebuttable presumption that a parent can be gainfully
employed on a full-time basis. If a parent is unemployed or is employed on less than a
full-time basis, then "child support shall be calculated based on a determination of
potential income." Id. OAR 137-050-0360(2)(c) states a presumption that a parent has
the potential to earn the "amount of income a parent could earn working full-time at the
current state minimum wage."
We note, however, that the rule also requires the court to determine the "gross income" of each parent. OAR 137-050-0330(2). OAR 137-050-0340 defines
gross income as
LEESON, J. pro tempore
"income from any source, including, but not limited to, salaries, wages,
commissions, advances, bonuses, dividends, severance pay, pensions,
interest, honoraria, trust income, annuities, return on capital, Social Security
benefits, workers' compensation benefits, unemployment insurance benefits,
disability insurance benefits, gifts, prizes, including lottery winnings, and
alimony or separate maintenance received."
(Emphasis added.) Support is to be calculated based on present income. Bach and Bach,
114 Or App 224, 225, 834 P2d 1041, rev den, 314 Or 573 (1992). As we explained in our
discussion of the previous assignment of error, husband refused to submit documentation
and records to support his claim of present income, and the record strongly suggests that
husband has income from sources other than his farming operation. Such income must be
taken into consideration in completing the computations called for by the child support
guidelines. On remand, therefore, in addition to determining wife's potential income, the
court must identify what it believes husband's gross income to be based on his testimony
at the hearing and then determine the presumptive amount of wife's child support
We turn to husband's remaining assignment of error. Husband contends
that the trial court abused its discretion in refusing to grant his request for a credit against
his child support arrearage for the months that one of the children who was the subject of
the support obligation resided with him. As noted, that child began living with husband
in June 2000, and the trial court terminated husband's obligation to pay support for that
child on August 1, 2003.
Husband concedes that the trial court "was under no statutory obligation" to
grant his request for a credit against his child support arrearage and that no case law
requires a court to do so. In arguing that the trial court abused its discretion in denying
the credit, he argues only that
"the legislature has recognized that there are situations where [not forgiving
support arrears] works an egregious result such as the case before this Court
now where both parties willingly participate in a de facto modification of
the custody arrangement imposed upon them by judgment only then [to]
have one parent realize a windfall in the form of child support that was not
ORS 107.135(7) (3) prohibits a court from modifying any portion of a
judgment that provides for the payment of money for the support of minor children that
has accrued before the motion is served. However, ORS 107.135(7)(a) provides that
"[t]he court may allow a credit against child support arrearages for periods of time,
excluding reasonable parenting time unless otherwise provided by order or judgment,
during which the obligor, with the knowledge and consent of the obligee or pursuant to
court order, has physical custody of the child[.]"
As noted, husband concedes that nothing in that statute requires a court to
grant a credit against child support arrearages. Rather, the statute provides that the court
"may" allow a credit against arreages under certain circumstances. See Pedroza and
Pedroza, 128 Or App 102, 106, 875 P2d 478 (1994) (acknowledging court's authority to
allow credit against child support arrearages for periods of time during which obligated
parent has physical custody of child with knowledge and consent of custodial parent).
The question is whether, on the facts of this case, the trial court erred in denying
husband's request for credit. See Briggs v. Briggs, 178 Or 193, 204, 165 P2d 772 (1946)
(discussing allowing credit against child support arrearages if equity so dictates under the
At the time of the hearing in this case, husband's child and spousal support
arrearage was almost $13,000. Since 1997, husband consistently has refused to comply
with the support terms in the stipulated judgment of dissolution or in the stipulated
modification. He acknowledges that the Oregon Department of Justice has advised him
of its intent to suspend his driving privileges because of his failure to pay support and that
wife previously has been forced to have him held in remedial contempt. Husband's
persistent refusal to abide by any of the terms of agreements relating to support that he
entered into voluntarily does nothing to advance his argument that equitable
considerations compel allowing credit against his child support arrearages. (4) See
Weber and Weber, 337 Or 55, 69, 91 P3d 706 (2004) (parties' own resolution of support
issues entitled to great weight). Were this a situation in which husband was in arrears
only for the support relating to the child who has lived with him since 2000, the equities
might be different. On the facts of this case, the trial court did not err in denying
husband's motion for credit against his support arrears.
Reversed and remanded for recalculation of child support; otherwise
Under the terms of the parties' marital settlement agreement, which was
incorporated into the judgment, wife agreed to a "downward deviation" from child support
guidelines and to accept less spousal support than "would otherwise be accepted" in return for
husband's agreement to pay all living expenses and costs of education for each child so long as
they desired to continue their course of study.
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Husband admitted at the hearing that he was "several months" in arrears on
spousal support payments.
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Although the 2003 Legislative Assembly amended ORS 107.135(7), Or Laws
2003, ch 419, § 1; Or Laws 2003, ch 572, § 13a, those amendments do not affect our analysis in
this opinion, and we thus refer to the current version of that statute.
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We note as well that, although husband had agreed to pay college costs and
expenses for the parties' children in return for wife accepting spousal support less than the
presumed amount, he acknowledged at the hearing that wife is paying costs and expenses for the
child attending Texas A&M.
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