Court Can Impute Income to a Voluntarily Unemployed Parent

Jan 19, 2017

In Kozlovsky v. Rubanchik, the husband and wife dated for four months, got married, and then separated four months later.  In March 2004, the wife moved back to her home state of Florida while the husband remained in New Jersey, where he was serving his dental residency.  On December 5, 2004, the wife gave birth to their daughter, and on December 23, the Family Part judge entered a judgment of annulment.  The judgment granted the husband and wife joint legal custody of their daughter, designated the wife as the parent of primary residence, and provided the husband parenting time as he and the wife may arrange.  Moreover, the judgment required the husband to pay the wife $15,000 in 6 installments, which would constitute “full satisfaction” of her claims “for support, maintenance, medical insurance, medical expenses, or distribution of property.”

The husband and wife agreed that he would pay $200 per week in child support for the first year of their daughter’s life, and that thereafter the obligation would be determined pursuant to the applicable child support guidelines.  The husband would also provide medical insurance for their daughter through his employer unless such insurance was unavailable to him, in which case the wife would provide coverage through her employer.  If neither of them had medical insurance through their jobs, then they were to share the expense proportionally based upon their respective incomes. The husband was also required to maintain his employer-sponsored life insurance designating their daughter as the beneficiary, as was the wife, if her employer sponsored life insurance.

In the ensuing years, the husband and wife engaged in extensive motion practice regarding life insurance, parenting time, child support, education, and extracurricular activities.  On February 1, 2012, the wife filed a motion seeking numerous forms of relief, including an increase in child support.  The husband cross-moved on the same issues and, on October 1, 2012, the judge issued a stay on all proceedings in order to afford Florida courts the chance to address custody and parenting time.  On March 1, 2013, an order entered pursuant to the Child Custody Jurisdiction and Enforcement Act granted New Jersey exclusive jurisdiction over the issue of child support, and Florida jurisdiction over custody and parenting time.  Florida accepted such jurisdiction on April 2, 2013.

Subsequently, on August 15, 2013, the wife filed the motion at issue, in which she sought: (1) an increase in child support retroactive to February 1, 2012; (2) an increase in the husband’s life insurance; (3) termination of the student loan deduction from the husband’s gross income in calculating child support; and (4) reduction or termination of the income imputed to her in calculating child support.  The wife’s motion was returned unfiled because, while she requested a fee waiver due to claimed indigence, she did not provide appropriate proofs.  As a result, the cross-motion the husband filed on September 25, 2013, was converted into a motion.  His motion sought: (1) a finding that the wife violated litigant’s rights by failing to provide proofs ordered by the court in 2009; (2) sanctions against the wife for violating court orders, filing frivolous motions, and submitting fraudulent certifications; and (3) that the wife be ordered to pay attorney fees and court costs.  The wife refiled her motion on October 15, 2013, and it was converted into a cross-motion.

On February 7, 2014, the Family Part entered a uniform summary support order and two companion orders, which raised the husband’s child support obligation to $342 per week retroactive to October 15, 2013, found the wife in violation of litigant’s rights, and awarded the husband $5,860 in fees and costs.  On February 19, 2014, a supplemental order set forth additional findings regarding the wife’s bad faith in: (1) failing to provide appropriate documentation for reimbursement of extracurricular activities; (2) neglecting to tell the husband about new activities and their associated expenses before accruing the same; and (3) preventing the husband from exercising parenting time with the daughter.  On March 25, 2014, another supplemental order lowered the income imputed to the wife from $100,000 to $75,000, which consequently raised the husband’s support obligation by $1.

On appeal, the wife argued that child support was incorrectly calculated because the trial court’s imputation of $75,000 in annual income to her was unsupported by the record.  Moreover, she claimed that $1,005 should not have been deducted from the husband’s gross income for education and business loans because they were an “unreasonable debt” that were not in the daughter’s best interests.  The Appellate Division rejected both arguments, explaining that ascertaining both parents’ income is critical to a fair child support award.  In some cases, this can include imputing income to a parent that is voluntarily unemployed without just cause.  Accordingly, the Appellate Division affirmed the Family Part’s decision to impute $75,000 to the wife because her pre-marriage earnings ranged from $75,000 to $100,000, and her decision to stay home to care for and homeschool her daughter was voluntary.  The Appellate Division also affirmed the loan deduction, explaining that there was “nothing unreasonable about the loans [the husband] needed to pay for his education and to establish his dental practice,” which enhanced his earning potential and thus benefitted his child.

The wife also argued that the trial judge should have retroactively applied the increase in child support to February 1, 2012, when she filed her original motion, rather than October 15, 2013.  The Appellate Division agreed on this issue, explaining that the lower court was incorrect in concluding that the wife “sat on her rights until she filed a cross-motion on October 15, 2013.”  The Appellate Division further explained that because the court never considered the wife’s original application to increase child support, the court abused its discretion in failing to set the effective date of the increase as February 1, 2012.

Finally, the wife argued that the judge made insufficient findings to support sanctioning her with an award of attorney fees and costs, but the Appellate Division disagreed.  The Appellate Division explained that the economic circumstances of both spouses is an important factor to consider in deciding whether a fee award is appropriate.  However, where one spouse acts in bad faith, their relative finances become less relevant in the analysis.  The Appellate Division upheld the fee award because the wife acted in bad faith in violating court orders.

If you have an issue with child support, contact the skilled matrimonial attorneys at Sarno da Costa D’Aniello Maceri LLC.  Call us today at (973) 274-5200.