124 A.3d 443
Vt.2015Background
- Eric Merchant and Sheila Merchant divorced by stipulated final order in Aug. 2009: shared physical custody (50/50 time), mother entitled to claim both children as tax dependents, and child-support order set at $200/mo (deviated up from $112.52 guideline).
- Father moved in Nov. 2011 to modify child support; magistrate (after 2012 hearing) calculated a new guideline obligation of $256.43/mo and dismissed the motion for failure to show a "real, substantial, and unanticipated" change (no >10% downward variance).
- Father challenged the magistrate’s guideline inputs: (1) alleged double-counting of income from ResQ Towing/Bundy’s; (2) contended the guideline should reflect that mother alone claimed the dependent exemptions; and (3) argued child-care costs should not be included because the divorce stipulation said each party would bear their own child-care costs during their parenting time.
- Family division affirmed: found magistrate’s income findings supported by evidence; held statute requires assuming dependent exemptions split equally for guideline calculations; and required consideration of qualifying child-care costs in the guideline calculation.
- Supreme Court affirmed: accepted magistrate’s discretionary factual findings on income, held the statutory guideline (15 V.S.A. § 653) prescribes equal allocation of exemptions for available-income calculations, and upheld inclusion of qualifying child-care costs based on record.
Issues
| Issue | Plaintiff's Argument (Merchant) | Defendant's Argument (Mother / Court) | Held |
|---|---|---|---|
| Whether the court had jurisdiction to modify based on the original >10% deviation (timing of comparison) | The >10% deviation should be measured at time of original order (Grimes) so magistrate retained authority to modify | Argument not preserved below; court would not consider new theory on appeal | Issue not considered on appeal (unpreserved) |
| Whether means‑tested public benefits and education/VA benefits trigger modification under § 660(c)(1) | Receipt of VA benefits, Pell Grant, and children’s Medicaid constitute a change of circumstances waiving the 10% rule | Argument not presented below; court declined to consider on appeal | Issue not considered on appeal (unpreserved) |
| Whether guideline calculation must reflect the parties’ actual allocation of dependent tax exemptions | Merchant: guideline should be manually calculated to reflect mother claiming both exemptions, reducing father’s imputed income | Statute (15 V.S.A. § 653) mandates using assumptions — equal share of exemptions — for shared custody; magistrate must apply statutory formula | Court held statute controls; magistrate did not err in using statutory assumption and need not recalculate by parties’ actual tax practice |
| Whether child‑care costs can be excluded from guideline calculation by stipulation in divorce decree | Merchant: stipulation that each party bears their own child‑care costs removes those costs from guideline inputs | Record shows contemporaneous child‑support worksheet included child‑care costs; statute requires consideration of qualifying child‑care costs in available income/total support | Court affirmed inclusion of qualifying child‑care costs; record did not show a stipulation to exclude them |
| Whether magistrate double‑counted father’s income (ResQ Towing & Bundy’s) | Merchant: 2011 ResQ tax return included Bundy’s subcontract income; using 2011 return plus 2012 Bundy’s pay stubs double‑counts wages | Magistrate: father failed to produce 1099 or clear documentation allocating 2011 receipts; factfinder reasonably relied on available evidence | Court affirmed magistrate’s income findings as supported by evidence and within discretion |
Key Cases Cited
- Kanaan v. Kanaan, 659 A.2d 128 (Vt. 1995) (standard for overturning trial‑court factual findings: clear error review)
- Grimes v. Grimes, 621 A.2d 211 (Vt. 1992) (discusses effect of deviation from guideline on modification jurisdiction)
- Adamson v. Dodge, 816 A.2d 455 (Vt. 2002) (explains statutory assumptions in guideline tax calculations and notes discrepancy with some stipulations)
- Cabot v. Cabot, 697 A.2d 644 (Vt. 1997) (factfinder credibility and deference in family‑law evidentiary disputes)
- LaMothe v. LeBlanc, 70 A.3d 977 (Vt. 2013) (shared‑custody guideline principles and consideration of households’ costs)