DANIEL HUGHES v. PAMELA HUGHES
AC 25767
Appellate Court of Connecticut
Argued November 14, 2005; officially released May 2, 2006
95 Conn. App. 200
Bishop, Harper and Mihalakos, Js.
The judgment is affirmed.
In this opinion the other judges concurred.
Gaetano Ferro, with whom were Brigid A. Connolly and, on the brief, Livia D. Barndollar, for the appellant (plaintiff).
Gary I. Cohen, for the appellee (defendant).
Opinion
BISHOP, J. The plaintiff, Daniel Hughes, appeals from the judgment of the trial court dissolving his marriage to the defendant, Pamela Hughes. On appeal, the plaintiff claims that the court improperly (1) relied on his gross
The following facts and procedural history are relevant to our resolution of the plaintiff‘s appeal. The parties were married on September 10, 1994. They are the parents of three children, all minors. Claiming an irretrievable breakdown in the marital relationship, the plaintiff brought this dissolution action by a cоmplaint dated August 9, 2001. He sought dissolution of the marriage, joint custody of the minor children and a division of the marital assets. The defendant admitted the allegations in the plaintiff‘s complaint and filed a cross complaint in which she sought dissolution of the marriage, sole custody of the minor children, child support, alimony and a division of the marital assets.
By memorandum of decision filed June 18, 2004, the court dissolved the parties’ marriage and issued financial orders.1 The plaintiff timely filed a motion to reargue, which was denied on July 28, 2004. This appeal followed.
As a preliminary matter, we set forth our standard of review. “An appellate court will not disturb a trial court‘s orders [financial or otherwise] in domestic rela-
I
The plaintiff‘s first three claims relate to the court‘s order of unallocated alimony and child support. The court ordered, inter alia: “The plaintiff shall pay unallocated periodic alimony and child support of 40 percent of the first $400,000 of his cash earnings in each year, 30 percent of the next $300,000 of cash earnings and 10 percent of the next $150,000 of cash earnings. Such earnings shall not include other forms of compensation such as stock options, restricted stock, [deferred profit sharing and employee stock ownеrship plans], capital accumulation plan or any other incentive awards. Payments shall be made monthly utilizing his base salary and the most recent cash bonuses paid for the prior year. Payments shall be made until the death of either party, the defendant‘s remarriage or her cohabitation as defined by
The plaintiff first claims that the court improperly relied on his gross income rather than on his net income in fashioning the unallocated alimony and child support order. Sрecifically, the plaintiff claims that because the court referred only to gross income and did not mention net income in its memorandum of decision, its order was based solely on gross income and was therefore improper.
The parties acknowledge that the principle of law governing this issue is clear. It is well settled that a court must base its child support and alimony orders on the available net income of the parties, not gross income. Collette v. Collette, 177 Conn. 465, 469, 418 A.2d 891 (1979). Whether or not an order falls within this prescription must be analyzed on a case-by-case basis. Thus, while our decisional law in this regard consistently affirms the basic tenet that support and alimony orders must be based on net income, the proper application of this principle is context specific.
In Morris v. Morris, 262 Conn. 299, 811 A.2d 1283 (2003), our Supreme Court reversed the judgment of the trial court because, in that instance, the court expressly relied on the parties’ gross incomes in modifying the defendant‘s child support obligation. The Morris court concluded: “Although the court broadly stated that its support order was based on financial affidavits, the court, nonetheless, expressly and affirmatively stated that the defendant has the following gross amounts which are properly included in his support income consideration . . . .” (Emphasis added; internal quotation marks omitted.) Id., 307.
In Ludgin v. McGowan, 64 Conn. App. 355, 358-59, 780 A.2d 198 (2001), this court reversed the judgment of the trial court because the court based its financial orders on the parties’ gross incomes. There, we stated:
In Greco v. Greco, 82 Conn. App. 768, 773, 847 A.2d 1017 (2004), aff‘d, 275 Conn. 348, 880 A.2d 872 (2005), this court reversed the trial court‘s alimony order, which was based on gross income, even though the trial court did not affirmatively and expressly state that it had relied on the parties’ gross incomes. In Greco, howеver, it was clear that the court relied solely on gross income because the financial orders far exceeded the obligor‘s available net income. Thus, the orders logically could only have been based on gross income.
In Kelman v. Kelman, 86 Conn. App. 120, 123, 860 A.2d 292 (2004), cert. denied, 273 Conn. 911, 870 A.2d 1079 (2005), although the trial court made reference to the parties’ gross incomes in its decision, it did not expressly state that it was relying solely on gross earnings in framing its order. In affirming the trial court‘s decision, this court stated: “[T]he court specifically stated that it took into account the relevant statutes, the parties’ testimony, the financial affidavits and the child support guideline worksheets, which included the parties’ net incomes.” Id., 123-24.
Although the records in Morris, Ludgin and Greco supported the conclusions in those cases that the trial court‘s financial orders were based solely on the parties’ gross incomes and not their net incomes, the record in this case does not compel such a conclusion. The case at hand is more analogous to Kelman. Although, in Kelman, the court‘s memorandum of decision referenced the parties’ gross incomes, it did not state that
In this case, the court noted the plaintiff‘s gross earnings to demonstrate their scope and variability in order to explain its reasoning for fashioning an order framed as a percentage of the plaintiff‘s gross earnings. The court stated: “The court lists the gross earnings of the plaintiff to illustrate the capability and ability he has displayed and the pay he has received for his efforts. Since his earned income fluctuates from year to year, the court will provide for a formula for the periodic alimony and child support. Each party has submitted a proposal in this respect in their proposed orders.” Indeed, the plaintiff‘s proposed orders, filed on April 21, 2004, suggest an unallocated alimony and child support order on the basis of his gross annual cash compensation from employment.2 The court further noted the gross and net values of the plaintiff‘s most recent cash bonus. Throughout its decision, the court made frequent reference to the parties’ financial affidavits. The court
It is noteworthy, too, that the court also expressly considered the parties’ proposed orders in which both parties proposed that the alimony and child support order should be unallocated and should be a function of the plaintiff‘s gross income. Although the court listed the plaintiff‘s gross earnings, taken from his tax returns for the years 1997 through 2003, unlike in Morris, the court here did not state that it relied on the plaintiff‘s gross earnings to form the basis of the order. Rather, the court merely referred to the plaintiff‘s gross income to demonstrate his ability to pay support. Finally, the fact that the alimony and support order was ultimately a function of gross income does not, alone, stand for the proposition that the order was based on gross income. Here, we differentiate between an order that is a function of gross income and оne that is based on gross income. In this regard, we note that we have found no case in which an order for support or alimony has been reversed on review simply because it was expressed as a function of a party‘s gross income. We believe that the term “based” as used in this context connotes an order that only takes into consideration the parties’ gross income and not the parties’ net income. Consequently, an order that takes cognizance of the parties’ disposable incomes may be proper even if it is expressed as a function of the parties’ gross earnings.
We note that, unlike in Kelman, the court in this case did not specifically reference the criteria used in making its decision. Our Supreme Court has repeatedly held, however, that the trial court is not required to make specific reference to the criteria that it considered in
B
The plaintiff next claims that the support order, by its terms, provides for child support beyond the age of majority and is thus beyond the jurisdiction of the court. Specifically, the plaintiff claims that the order must contain a step-down to coincide with each child reaching the age of majority. We disagree.
As a general matter, “[t]he obligation of a parent to support a child terminates when the child attains the age of majority, which, in this state, is eighteen.
The plaintiff claims that because the order provides for no reduction as each child reaches the age of majority, a portion of the support order will necessarily be attributable to the support of a child who has surpassed the age of majority. The plaintiff fails to acknowledge, however, the fact that he may move to modify the combined alimony and support order at any time, including the date on which each child reaches the age of majority.5 This court has held that “[w]hen, as part of a divorce decree, a parent is ordered to pay a specified amount periodically for the benefit of more than one child, the emancipation of one child does not automatically affect the liability of the parent for the full amount. . . . The proper remedy . . . is to seek a modification of the decree.” (Citation omitted; internal quotation marks omitted.) Gillespie v. Gillespie, 8 Conn. App. 382, 386, 512 A.2d 238 (1986). Thus, although the attainment of majority by each child may not automatically entitle the plaintiff to a reduction in his alimony and support obligation, it provides a basis for the plaintiff to seek a modification. Because the order as framed by the court does not, by its own terms, require a payment of combined alimony and support beyond the dates on which the children reach the age of majority, and because the order is subject to modification as each
Accordingly, we hold that thе court‘s alimony and support order, which can be modified at any time by the court, does not, by its terms, require the plaintiff to pay postmajority child support. Therefore, it does not constitute an abuse of discretion by the court.
C
The plaintiff also claims that the court improperly awarded lifetime alimony. Specifically, the plaintiff claims that because the parties were married for less than ten years and they were both thirty-eight years old and in good health at the time of dissolution, the court abused its discretion in awarding alimony of indefinite duration. The record belies the plaintiff‘s claim.
”
In this case, the court found that the plaintiff‘s behavior, specifically his extramarital relationship, was the primary cause for the breakdown of the marriage. The court found that although both parties were in good health, the defendant has had no career other than as a homemaker, and that the plaintiff‘s occupation, vocational skills and employability afforded him greater prospects for income than were available to the defendant. The court also undertook a thorough examination of the assets of the parties. It is clear that the court was mindful of its obligation to consider the statutory factors in determining alimony. Given the court‘s finding, which was amply supported by the record, that the defendant had not been employed outside the home, had no prospects for employment and had no skills for employability, and the court‘s apparent consideration of the statutory factors, we cannot conclude that the court abused its discretion in issuing an alimony order of unlimited duration.
II
The plaintiff next claims that the court improperly awarded the defendant 50 percent of all of the plaintiff‘s stock options and restricted stock units.6 Specifically, the plaintiff claims that the court should have distinguished between those awards he received for services performed during the marriage, those he received for employment services after the parties’ separation and those he received in contemplation of future services. In making this claim, the plaintiff acknowledges, as he must, that the court has a broad latitude of discretion in formulating its orders regarding the distribution of
III
The plaintiff next claims that the court improperly considered his bonus that was paid in early 2004 both as a source of income and as an asset to be distributed. This claim lacks merit.
As noted, the court ordered child support and alimony to be based on thе plaintiff‘s cash earnings, including his cash bonuses. The court further ordered: “The plaintiff is awarded and shall retain his Chase Bank account listed as containing $326,979 . . . .” In January, 2004, the plaintiff received a bonus for his prior year‘s employment in the amount of $766,250 gross, and $456,992.78 net, which he claims he deposited into his Chase Bank account. The plaintiff claims that the court improperly based the support order on the bonus and awarded the bonus to the plaintiff as part of the division of assets. Merely because the plaintiff claims to have deposited the bonus into an account awarded to him as part of the property distribution does not indicate
IV
The plaintiff finally claims that the totality of the court‘s financial orders constituted an abuse of discretion. We disagree.
“A fundamental principle in dissolution actions is that a trial court may exercise broad discretion in awarding alimony and dividing property as long as it considers all relevant statutory criteria. . . . In reviewing the trial court‘s decision under [an abuse of discretion] standard, we are cognizant that [t]he issues involving financial orders are entirely interwoven. The rendering of judgment in a complicated dissolution case is a carefully crafted mosaic, each element of whiсh may be dependent on the other.” (Internal quotation marks omitted.) Chyung v. Chyung, supra, 86 Conn. App. 668.
The judgment is affirmed.
In this opinion HARPER, J., concurred.
MIHALAKOS, J., dissenting. I respectfully dissent from the majority‘s conclusion that the trial court acted properly in fashioning its financial order. I believe that the court based the alimony and child support obligation of the plaintiff, Daniel Hughes, on gross income, which constituted an abuse of its discretion.
“Notwithstanding the great deference accorded the trial court in dissolution proceedings, a trial court‘s ruling . . . may be reversed if, in the exercise of its discretion, the trial court applies the wrong standard of law.” (Internal quotation marks omitted.) Morris v. Morris, 262 Conn. 299, 305, 811 A.2d 1283 (2003). Our law is clear that “a court must base child support and alimony orders оn the available net income of the parties, not gross income.” (Emphasis added; internal quotation marks omitted.) Id., 306; see also Collette v. Collette, 177 Conn. 465, 469, 418 A.2d 891 (1979); Tobey v. Tobey, 165 Conn. 742, 747, 345 A.2d 21 (1974); Febbroriello v. Febbroriello, 21 Conn. App. 200, 202, 572 A.2d 1032 (1990). Stated another way, “[g]ross earnings is not a criterion for awards of alimony.” (Emphasis added; internal quotation marks omitted.) Ludgin v. McGowan, 64 Conn. App. 355, 358, 780 A.2d 198 (2001).
In Ludgin v. McGowan, supra, 64 Conn. App. 355, this court held that a trial court‘s repeated reference in its memorandum of decision to the parties’ gross incomes, along with the failure to discuss the issue of net income, violated our well established precedent requiring that financial orders be based on net income, not gross income. Id., 358. As I will discuss in greater detail, it is my belief that the reasoning in Ludgin dictates a reversal of the court‘s financial order in this case. I believe that the majority‘s decision to discount our holding in Ludgin misinterprets our case law and will lead to confusion and instability in an area of law that is in need of clear and consistent guidelines.
Ludgin involvеd a dissolution action in which the parties sought alimony and child support orders from the court. Id., 356. Prior to the hearing, the parties had furnished the court with evidence of both their gross and net incomes. Id., 357, 358 n.2. In its memorandum of decision setting forth the financial orders, the court repeatedly referred to and compared the parties’ gross incomes.1 Id., 358. The plaintiff appealed to this court,
As in Ludgin, the court in the present case, despite having before it evidence of net income, focused entirely on gross income throughout its memorandum of decision. The most compelling evidence that the court based its оrder on gross income is the terms of the financial order, which were expressed as a percentage of the plaintiff‘s gross income.2 I agree with the majority that a alimony and child support order expressed as a function of gross income could, in theory, still be based on net income. Nevertheless, that the court chose to express its order as a percentage of the plaintiff‘s gross income is significant and warrants closer scrutiny into the court‘s reasoning for basing the order on the gross, rather than the net, figures.
Here, however, it is not only the terms of the order but the totality of the court‘s reasoning throughout its memorandum of decision that leads me to cоnclude
The majority reasons that the court made repeated reference to the plaintiff‘s gross income solely to demonstrate his ability to pay support. I disagree. The better explanation, rather, for why the court focused on gross income is because the proposed orders submitted by both parties requested that the award be based on gross income. As the majority notes, the court expressly references the parties’ proposed orders in its memorandum of decision. See footnote 2 of the majority opinion. That the parties requested that the order be based on gross income and that the court responded with an award expressed as a function of gross income strongly indicates that the court based its award on gross income. Regardless of whether the parties requested such a result in their proposed orders, however, the court cannot circumvent our well established precedent requiring that financial orders be based on net income. See Morris v. Morris, supra, 262 Conn. 306.
In further support of its decisiоn to sustain the order, the majority relies on Kelman v. Kelman, 86 Conn. App. 120, 860 A.2d 292 (2004), cert. denied, 273 Conn. 911, 870 A.2d 1079 (2005). In Kelman, we determined that a trial court, despite having referenced the parties’ gross incomes in its memorandum of decision, did not abuse its discretion in fashioning its financial orders. Id., 124. There is a critical distinction between Kelman and the present case, however. In Kelman, the court expressly stated that it had based its orders on all of the relevant information, including the parties’ financial affidavits and child support guideline worksheets, both of which included the parties’ net incomes. Id., 123. The presence
The law is clear and simple: financial orders may not be based on gross income. When all evidence indicates that an award has been based on gross income, a trial court cannot be entitled to a presumption otherwise. I respectfully dissent from part I of the majority‘s opinion and, consequently, would not reach the other claims presented on appeal. I would reverse the judgment as to the financial orders and remand the case for a new hearing in accordance with law.