Katie A. Schrodt, Plaintiff and Appellee v. Joseph D. Schrodt, Defendant and Appellant and State of North Dakota, Statutory Real Party in Interest and Appellee
No. 20210211
IN THE SUPREME COURT STATE OF NORTH DAKOTA
MARCH 17, 2022
2022 ND 64
Appeal from the District Court of McLean County, South Central Judicial District, the Honorable Douglas A. Bahr, Judge.
AFFIRMED.
Opinion of the Court by VandeWalle, Justice.
Heather M. Krumm, Mandan, ND, for plaintiff and appellee; submitted on brief.
Rodney E. Pagel, Bismarck, ND, for defendant and appellant; submitted on brief.
Sheila K. Keller, Special Assistant Attorney General, Bismarck, ND, for statutory real party in interest and appellee; submitted on brief.
Schrodt v. Schrodt
No. 20210211
[¶1] Joseph Schrodt appealed from a divorce judgment. Joseph Schrodt raises numerous issues including the district court‘s denial of his request for a continuance, the court‘s valuation of certain marital assets, the court‘s calculation of child support, the court‘s parenting plan, and the court‘s award of attorney‘s fees and costs to Katie Schrodt. We affirm.
I
[¶2] Katie Schrodt and Joseph Schrodt married on May 29, 2018. Joseph Schrodt is self-employed as a welder and Katie Schrodt is employed as an equipment operator. The parties share one minor child born in 2016. In 2018, Joseph Schrodt left his job at the union to open his own business, Wolf Creek Welding, in which Katie Schrodt helped with the paperwork and taxes. Katie Schrodt commenced this divorce action in October 2019.
[¶3] On January 14, 2021, Joseph Schrodt‘s attorney filed a motion to withdraw based on the attorney-client relationship had irreparably broken down and Joseph Schrodt substantially failed to fulfill obligations to his attorney. His attorney also filed a request for expedited consideration. This was Joseph Schrodt‘s third attorney
[¶4] The divorce trial was held January 26-27, 2021. On the morning of trial, Joseph Schrodt emailed the clerk of court requesting a continuance because he did not have an attorney. Joseph Schrodt stated at beginning of trial that he was not aware of the hearing held but was aware that his attorney withdrew. The district court denied his request for a continuance, reasoning that this was his third attorney and questioned whether he would have one even if a continuance was granted. The court noted that Joseph Schrodt had known for at least a week that his attorney was withdrawing and that a lot of work goes into trial preparation including witnesses traveling for trial. Additionally, the court noted the request was untimely.
[¶5] Following the trial, the district court granted the parties’ divorce, awarded Katie Schrodt primary residential responsibility subject to Joseph Schrodt‘s reasonable parenting time, distributed the marital estate, ordered Joseph Schrodt to pay child support, and awarded Katie Schrodt $36,538 in attorney‘s fees.
II
[¶6] Joseph Schrodt argues the district court abused its discretion when it denied his motion for a continuance because he was not given an opportunity to respond to his counsel‘s motion to withdraw under
[¶7] It is well-settled that this Court does not review issues that are raised for the first time on appeal:
The purpose of an appeal is to review the actions of the trial court, not to grant the appellant an opportunity to develop and expound upon new strategies or theories. The requirement that a party first present an issue to the trial court, as a precondition to raising it on appeal, gives that court a meaningful opportunity to make a correct decision, contributes valuable input to the process, and develops the record for effective review of the decision. It is fundamentally unfair to fault the trial court for failing to rule correctly on an issue it was never given the opportunity to consider. Accordingly, issues or contentions not raised . . . in the district court cannot be raised for the first time on appeal.
Cody v. Cody, 2019 ND 14, ¶ 15, 921 N.W.2d 679 (quoting Hoff v. Gututala-Hoff, 2018 ND 115, ¶ 10, 910 N.W.2d 896). Joseph Schrodt did not raise the issue that his request to continue the trial should be granted because he was not given an opportunity to respond to his attorney‘s motion to withdraw. Nor does Joseph Schrodt argue that the district court should not have granted the motion to withdraw. Therefore, the issue of whether the district court complied with
[¶8] “The district court has broad discretion over the progress and conduct of a trial, and the determination whether to grant a continuance lies within the sound discretion of the district court.” Lund v. Lund, 2011 ND 53, ¶ 7, 795 N.W.2d 318 (citations omitted). This Court will not reverse a district court‘s decision to deny a motion for a continuance absent an abuse of discretion. Carroll v. Carroll, 2017 ND 73, ¶ 11, 892 N.W.2d 173. “The
[¶9] A motion for a continuance made after a notice of trial has been issued is governed by
A party seeking a continuance must make a request to continue a trial within 14 days after receiving notice of trial from the court. The trial judge scheduled to hear the case must approve any request for continuance. If unavoidable circumstances are shown, the trial judge may waive the 14-day requirement.
Under the North Dakota Rules of Court, motions for continuance “shall be promptly filed as soon as the grounds therefor are known and will be granted only for good cause shown, either by a declaration or otherwise.”
[¶10] On the morning of trial, Joseph Schrodt requested a continuance because he did not have an attorney. Joseph Schrodt acknowledged that he was aware that his attorney had withdrawn but was not aware of the hearing held. When asked why he did not request a continuance a week prior to trial, Joseph Schrodt replied that he should have but he “had a lot on his plate.” When asked what efforts he made to get an attorney, Joseph Schrodt explained that he had called several attorneys, but there was conflict with all of them and the closest one was in Fargo. The district court denied his request reasoning that this was his third attorney and questioned whether he would have one even if a continuance was granted. The court noted that Joseph Schrodt had known for at least a week that his attorney was withdrawing and that a lot of work goes into trial preparation including witnesses traveling for trial. Additionally, the court noted the request was untimely. Under the circumstances in this case, the district court did not abuse its discretion in denying Joseph Schrodt‘s request for a continuance.
III
[¶11] Joseph Schrodt argues the district court erred in its valuation of his tools, racecar, racecar parts, and a vehicle because the court accepted Katie Schrodt‘s values listed in her property and debt listing without any other evidence and because the court stated Joseph Schrodt would be in the best position to know the value of the assets.
[¶12] We will not reverse a district court‘s findings on valuation of marital property unless they are clearly erroneous. Lee v. Lee, 2019 ND 142, ¶ 6, 927 N.W.2d 104 (citing Corbett v. Corbett, 2001 ND 113, ¶ 12, 628 N.W.2d 312). “A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, there is no evidence to support it, or if, although there is some evidence to support it, on the entire evidence the reviewing court is left with a definite and firm conviction a mistake has been made.” Kautzman v. Kautzman, 1998 ND 192, ¶ 8, 585 N.W.2d 561 (citing Gierke v. Gierke, 1998 ND 100, ¶ 15, 578 N.W.2d 522). “[A] trial court, having the opportunity to observe demeanor and credibility, is in a far better position than an appellate court in ascertaining the true facts regarding property value.” Hitz v. Hitz, 2008 ND 58, ¶ 13, 746 N.W.2d 732 (quoting Hoverson v. Hoverson, 2001 ND 124, ¶ 13, 629 N.W.2d 573). “A marital property valuation within the range of the evidence is not clearly erroneous.” Hitz, at ¶ 13 (quoting Hoverson, at ¶ 13).
IV
[¶14] Joseph Schrodt argues the parenting time implemented by the district court is clearly erroneous because it denies the child the right to maintain a “parent-child relationship that is beneficial” to the child.
[¶15] Under
A non-custodial parent‘s visitation may be curtailed or eliminated entirely if it is likely to endanger the child‘s physical or emotional health. However, a restriction on visitation must be based on a preponderance of the evidence and be accompanied by a detailed demonstration of the physical or emotional harm likely to result from visitation.
Rustad v. Baumgartner, 2018 ND 268, ¶ 8, 920 N.W.2d 465 (citations and quotations omitted).
[¶16] A district court‘s determination of parenting time is a finding of fact subject to the clearly erroneous standard of review. Deyle, 2012 ND 248, ¶ 17. “A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence exists to support it, or if, upon review of the entire record, this Court is left with a definite and firm conviction a mistake has been made.” Schurmann v. Schurmann, 2016 ND 69, ¶ 8, 877 N.W.2d 20 (quoting Capes v. Capes, 2015 ND 254, ¶ 6, 870 N.W.2d 448).
[¶17] Here, in awarding Joseph Schrodt parenting time, the district court considered the best interests factors. Joseph Schrodt was awarded parenting time every other weekend, three weeks of summer parenting time, and rotating holidays. The parenting time was limited to five counties unless Joseph Schrodt receives prior written consent by Katie Schrodt or order of the court. Joseph Schrodt argues that restricting and limiting his parenting time to one overnight every two weeks and to five counties is clearly erroneous because he posed no threat to the minor child and has been a good, caring father. This Court does not reweigh evidence nor reassess the credibility of witnesses. Conzemius v. Conzemius, 2014 ND 5, ¶ 6, 841 N.W.2d 716. The district court found factor (f) of
V
[¶18] Joseph Schrodt argues the district court erred in its calculation of child support because he was not underemployed.
[¶19] This Court applies a mixed standard of review from child support determinations:
“Child support determinations involve questions of law which are subject to the de novo standard of review, findings of fact which are subject to the clearly erroneous standard of review, and may, in some limited areas, be matters of discretion subject to the abuse of discretion standard of review.” Grossman v. Lerud, 2014 ND 235, ¶ 6, 857 N.W.2d 92 (quoting State ex rel. K.B. v. Bauer, 2009 ND 45, ¶ 8, 763 N.W.2d 462). “A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence exists to support it, or if, on the entire record, we are left with a definite and firm conviction that a mistake has been made.” Richter v. Houser, 1999 ND 147, ¶ 3, 598 N.W.2d 193.
Eubanks v. Fisketjon, 2021 ND 124, ¶ 6, 962 N.W.2d 427 (quoting Gooss v. Gooss, 2020 ND 233, ¶ 14, 951 N.W.2d 247).
[¶20] “Child support determinations are governed by the child support guidelines,
[¶21] Joseph Schrodt argues the district court erred in finding him underemployed and imputing his income under
[¶22] “Determination of whether an individual is underemployed is within the discretion of the trial court.” Torgerson v. Torgerson, 2003 ND 150, ¶ 10, 669 N.W.2d 98 (citing Geinert v. Geinert, 2002 ND 135, ¶ 18, 649 N.W.2d 237). A court may find an obligor is underemployed and impute the obligor‘s income, if “the obligor‘s gross income from earnings is significantly less than this state‘s statewide average
Determination of a self-employed individual‘s income for the purpose of calculating a child support obligation is governed, at least initially, by
N.D. Admin. Code § 75-02-04.1-05 . “Net income from self-employment means total income, for internal revenue service purposes, of the obligor.”N.D. Admin. Code § 75-02-04.1-05(1) . The guidelines recognize that “[s]elf-employment activities may experience significant changes in production and income over time.”N.D. Admin. Code § 75-02-04.1-05(4) . “To the extent that information is reasonably available, the average of the most recent five years of each self-employment activity, if undertaken on a substantially similar scale, must be used to determine self-employment income.”Id. “If the tax returns are not available or do not reasonably reflect the income from self-employment, profit and loss statements which more accurately reflect the current status must be used.”N.D. Admin. Code § 75-02-04.1-05(3) .
Thompson v. Johnson, 2019 ND 111, ¶ 9, 926 N.W.2d 120.
[¶23] Here, the district court found it was difficult to determine Joseph Schrodt‘s actual income because he appeared to be taking cash payments and not recording them when reporting his income. The court explained that it had limited other information to use in determining his income. Joseph Schrodt testified that he had not looked over his books for 2020 because he has “had a lot of stuff going on.” When asked what he expected to earn in 2020, he testified that he didn‘t know, maybe $30,000 to $40,000. This testimony is not sufficiently documented information that would fully apprise the court of all gross income nor was there any profit and loss statements provided to the district court. Thus, the court did not err in not averaging the two incomes because the only documented information provided was Joseph Schrodt‘s 2019 individual tax return and his 2018 W-2s. The court found that Joseph Schrodt‘s 2019 taxes showed an adjusted gross income of $20,860 and his 2018 W-2s showed that he earned $83,772 that year.
[¶24] Additionally, Joseph Schrodt argues the district court should have used the U.S. Bureau of Labor Statistics to determine whether he was underemployed. Both
[¶25] The district court presumed Joseph Schrodt was underemployed under
[G]ross income based on earning capacity equal to the greatest of subdivisions a through c, less actual gross earnings, must be imputed to an obligor who is unemployed or underemployed.
- A monthly amount equal to one hundred sixty-seven times the hourly federal minimum wage.
- An amount equal to six-tenths of this state‘s statewide average earnings for persons with similar work history and occupational qualifications.
- An amount equal to ninety percent of the obligor‘s greatest average gross monthly earnings, in any twelve consecutive
months included in the current calendar year and the two previous calendar years before commencement of the proceeding before the court, for which reliable evidence is provided.
“[T]he subdivision resulting in the greatest imputed income must be used.” McClure v. McClure, 2003 ND 130, ¶ 8, 667 N.W.2d 575 (quoting Buchholz v. Buchholz, 1999 ND 36, ¶ 14, 590 N.W.2d 215).
[¶26] Joseph Schrodt‘s child support obligation was determined under subsection (c) by using ninety percent of his 2018 earnings, $83,773, which is the greatest average gross monthly earnings that he had in a 12-month period beginning on or after 36 months before commencement of these proceedings. The district court adopted the Child Support‘s calculations and found that Joseph Schrodt had a monthly child support obligation of $970 based upon his imputed net monthly income of $5,384. Therefore, the district court did not abuse its discretion in determining Joseph Schrodt was underemployed and imputing his gross income based on earning capacity under
VI
[¶27] Joseph Schrodt argues the district court erred in awarding attorney‘s fees to Katie Schrodt because the court failed to consider her needs and his lack of ability to pay.
[¶28] The district court has broad discretion to award attorney‘s fees in divorce proceedings under
[¶29] “We have said the primary standard for awarding attorney‘s fees under
[¶30] A district court also has inherent authority to award attorney‘s fees as a sanction for a litigant‘s misconduct. Heinle, 2010 ND 5, ¶ 30. If a court orders a party to pay attorney‘s fees under its inherent authority to impose a sanction for misconduct, the court is not required to consider need and ability to pay. Brew, 2017 ND 242, ¶ 34. This court has explained:
A district court also has inherent authority to sanction a litigant for misconduct. Sanctions must be reasonably proportionate to the misconduct. When sanctioning a party for misconduct, a district court should consider and make findings on the culpability or state of mind of the party against whom sanctions are being imposed, the prejudice to the moving party, the impact of the prejudice on the moving party‘s ability to present or defend the party‘s case, and the availability of less severe sanctions.
A district court has discretion in awarding attorney fees as a sanction in divorce actions. An award of attorney fees as a sanction will not be disturbed on appeal unless the court abuses its discretion. A court abuses its discretion when it acts in an arbitrary, unreasonable, or unconscionable manner, when it misinterprets or misapplies the law, or when its decision is not the product of a rational mental process leading to a reasoned determination.
Id. at ¶ 32 (quoting Lewis v. Smart, 2017 ND 214, ¶ 32, 900 N.W.2d 812). In Brew and Lewis, this Court held that a district court is not required to consider need and ability to pay if it awarded attorney‘s fees under its inherent authority to impose a sanction rather than solely under
[¶31] Here, the district court awarded attorney‘s fees as a sanction for Joseph Schrodt‘s misconduct. Although the court‘s findings cite
Katie‘s attorney‘s fees and costs were increased due to Joseph‘s improper or unreasonable pre-trial actions, including him repeatedly removing the child from the state in violation of a court order, his failure to pay joint debts as required by the Interim Order, and his failure to comply with discovery requests and explicit orders of this Court. Katie‘s attorney‘s fees and costs were also increased due to Joseph‘s improper or unreasonable actions during and after trial, including not producing ordered documents, being on time, and taking a recess to make copies.
[¶32] The district court‘s findings are sufficient to adequately explain the basis of the award as a sanction for litigation misconduct. The court ordered Katie Schrodt to provide a statement of attorney‘s fees and costs identifying the attorney‘s fees and costs she incurred as a result of Joseph Schrodt‘s improper and unreasonable pre-trial, trial, and post-trial actions. In her statement of attorney‘s fees and costs, Katie Schrodt identified and explained the amount of attorney‘s fees that were normal and those that were abnormal due to Joseph Schrodt‘s misconduct. The total amount of abnormal attorney‘s fees was
VII
[¶33] We affirm the judgment.
[¶34] Jon J. Jensen, C.J.
Gerald W. VandeWalle
Daniel J. Crothers
Lisa Fair McEvers
Jerod E. Tufte