Lyman v. Lyman, 795 N.W.2d 475

Divorce between Scot and Sally left Sally with primary placement of two minor sons and a pre-existing child support order converting to a 1999 schedule (25% up to $185,000, 5% above $185,000, funds to trusts with $9,500 per trust cap).
In 2004 Sally sought modification; 2005 order capped child support at $6,250/month, later found excessive; 2006 and 2007 stipulations modified percentages depending on income thresholds.
In 2004–2008 changes, oldest son turned 18 in 2007 and younger son remained a minor, affecting who received support under stipulations.
In June 2008 Scot settled a wrongful termination claim with St. Jude Medical for $3,490,000; Scot reported the full amount as income and incurred $1,180,000 in attorney fees.
December 2009 circuit court held the settlement was income for child support purposes, allocated 2.2 million to be subject to the 2007 stipulation, and awarded Sally $220,000 with no interest.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Is the unallocated settlement gross income for child support?	Scot contends settlement is not income for child support.	Sally contends settlement should be treated as income for child support.	Yes; all settlement income treated as gross income.
Did the circuit court properly apply the 2007 high-income payor stipulation?	Scot argues court should follow 2005/2006 terms or deem 2007 terms unfair.	Sally supports applying the 2007 stipulation as controlling.	Yes; court properly applied 2007 stipulation.
Was the 2005 order limiting support to $6,250/month applicable?	Scot argues the 2005 cap should control.	Sally argues changed circumstances authorize different terms; stipulations override 2005 order.	No; later stipulations/changed circumstances prevail.
Should taxes paid on the settlement be deducted from the child-support amount?	Scot seeks deduction of taxes paid on settlement.	Taxes are not deductible when calculating gross income for child support.	No; deductions limited to attorney fees/costs; taxes not deductible.
Should a trust be imposed on the child-support award?	Scot seeks trust to ensure funds are used for sons' benefit.	No evidence Sally cannot manage funds; trust not warranted.	No; court has discretion, no transfer to trust.

Rottscheit v. Dumler, 262 Wis. 2d 292 (2003) (parents' duty to support children; standard of living)
Sommer v. Sommer, 108 Wis. 2d 586 (Ct. App. 1982) (child support aims to preserve child's standard of living)
Ayres v. Ayres, 230 Wis. 2d 431 (1999) (guides deviation from standard child support formula)
Doerr v. Doerr, 189 Wis. 2d 112 (Ct. App. 1994) (application of percentage standards to gross income)
Luciani v. Montemurro-Luciani, 199 Wis. 2d 280 (1996) (burden of proof in applying high-income payor formula)
Cameron v. Cameron, 209 Wis. 2d 88 (1997) (trusts on child support; standard for limiting or denying)
Abitz v. Abitz, 155 Wis. 2d 161 (1990) (gross vs net income in calculating support)