Dare v. Frost Dissent final
2017 Ark. App. 451
| Ark. Ct. App. | 2017Background
- Parrish Dare sought an increase in child support, asking the court to include Scott Frost’s capital gains and appreciation in his investment/stock accounts in income.
- Frost’s tax returns reported investment-account gains (taxable events), but he had not taken any distributions — gains were reinvested and remained in the accounts.
- Trial court declined to treat unrealized appreciation as income for child-support calculations, likening the accounts to retirement or real-property value that only counts when disbursed.
- The trial court explained that requiring courts to account for annual fluctuations in investment value would be cumbersome and could produce inconsistent results (including downward adjustments for losses).
- The appellate court issued a decision reversing and remanding on the child-support issue; Judge Klappenbach dissented from denial of rehearing, arguing the trial court did not abuse its discretion in excluding unrealized gains.
Issues
| Issue | Plaintiff's Argument (Dare) | Defendant's Argument (Frost) | Held |
|---|---|---|---|
| Whether unrealized capital gains/appreciation in Frost’s investment accounts should be included as income for child-support calculations | Include the taxable capital gains and appreciation as income to determine disposable income for child support | Unrealized appreciation is not expendable income; no distributions were made, so gains should not count as income | Trial court permissibly excluded unrealized appreciation; inclusion only appropriate if/when disbursements are made (trial court did not abuse discretion, per dissent) |
| Visitation ruling | (Implicit) challenge to trial-court visitation order | Trial court’s visitation order should stand | Visitation ruling was affirmed by the court (dissent agreed with affirmation) |
Key Cases Cited
- Huey v. Huey, 90 Ark. App. 98, 204 S.W.3d 92 (income for child support may differ from tax income)
- White v. White, 95 Ark. App. 274, 236 S.W.3d 540 (capital gains improperly included in child-support calculation reversed)
- Brown v. Brown, 76 Ark. App. 494, 68 S.W.3d 316 (goal: determine true disposable income of payor)
- Stepp v. Gray, 58 Ark. App. 229, 947 S.W.2d 798 (definition of income focuses on disposable income)
- Ford v. Ford, 347 Ark. 486, 65 S.W.3d 432 (one-time receipts can constitute income)
- Southerland v. Southerland, 75 Ark. App. 386, 58 S.W.3d 867 (post-divorce appreciation in marital property not treated as income)