Johnson v. Young
2017 Ark. App. 132
Ark. Ct. App.2017Background
- Parties divorced in 2005; Johnson awarded primary custody of two children and Young ordered to pay $800/month child support and split tuition/daycare costs.
- In 2014 Johnson sought modification, contempt, and venue change; venue denied and a 2015 order found Young in contempt for unpaid obligations, awarded Johnson attorney fees, allowed her to claim both children for 2015 taxes, but denied an increase in child support without explanation.
- Young testified to $6,000/month income on his affidavit but deducted rent and child-support payments (deductions improper under Admin. Order No. 10); he is a 20% partner in two family businesses and pays self-employment taxes.
- Tax returns for 2012–2014 were admitted showing adjusted gross incomes of $177,613 (2012), $228,643 (2013), and $188,166 (2014); less than 10% of income was attributable to Young’s wife.
- The trial court inexplicably found Young’s "true income" to be $3,300/month despite tax returns and affidavit showing much higher income and made no findings that tax returns were unreliable or that it was applying the net-worth method.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the trial court used the correct method to calculate Young's income for child support | Johnson: Court should compute income under Admin. Order No. 10 using Young’s last two years' federal/state tax returns (self-employed/partner) | Young: Presented lower monthly pay checks and contended his take-home was ~$3,500–$3,600 after support; minimized tax-return relevance | Court: Reversed — trial court erred by not using tax returns per Admin. Order No. 10 and Tucker; court made no findings that returns were unreliable nor applied net-worth method |
| Whether there was a material change of circumstances warranting modification of child support | Johnson: Children older with greater expenses; original $800 tied to lower income/chart in 2005; income changes and children’s needs constitute material change | Young: Implicitly relied on stability of prior agreement and lower claimed monthly take-home | Court: Remanded — trial court failed to make/find whether a material change occurred; must consider statutory 20% change rule and factor-based analysis |
Key Cases Cited
- Montgomery v. Bolton, 349 Ark. 460 (definition of income for child support is intentionally broad)
- Tucker v. Office of Child Support Enf’t, 368 Ark. 481 (self-employed payor’s income determined from last two years’ tax returns or, if unreliable, use net-worth/earning-capacity approach)
- Brown v. Brown, 373 Ark. 333 (partner may be treated as self-employed payor under Admin. Order No. 10)
- Hill v. Kelly, 368 Ark. 200 (material-change standard for child-support modification)