No. 04-1039.Court of Appeals of Iowa.
March 31, 2005.
Decisions without published opinions. Affirmed in part and Reversed in part.
Appeal from the Iowa District Court for Linn County, David M. Remley, Judge.
Charlene Meier appeals the modification of the child support and alimony provisions of the parties’ dissolution decree.AFFIRMED IN PART AND REVERSED IN PART.
Anne K. Wilson of Fishel Hoskins, Marion, for appellant.
Steven E. Howes and Stephanie K. LeClare of Howes Law Firm, P.C., Cedar Rapids, for appellee.
Heard by Vogel, P.J., and Mahan and Vaitheswaran, JJ.
MAHAN, J.
Charlene Meier appeals the modification of the child support and alimony provisions of the parties’ dissolution decree. Specifically, she argues the trial court incorrectly calculated the child support obligations of the parties. She further contends the court’s reduction of alimony was unwarranted. We affirm in part and reverse in part.
I. Background Facts Proceedings.
Charlene and Ronald (Ron) Meier were married on February 14, 1987. Ron is self-employed as the owner of CR Auto Cleaning. The sole proprietorship had gross receipts of $203,232 in 2001, $186,507 in 2002, and $246,555 in 2003. Ron’s average annual income is approximately $36,342. Charlene has not worked outside the home since the parties married. Charlene and Ron have three children: Justin, born January 9, 1989; Jessica, born February 14, 1990; and Joshua, born April 19, 1991. The parties’ youngest son, Joshua, has been diagnosed with Factor VIII deficiency, more commonly known as hemophilia. He requires preventative treatment for his hemophilia three times a week.[1] Joshua also has behavioral problems and has been diagnosed with attention deficit/hyperactivity disorder.
A decree of dissolution of marriage was filed on February 24, 1999. The dissolution decree was based on the parties’ stipulation. Pursuant to the stipulation, Charlene was awarded primary physical care of the children subject to Ron’s visitation rights. Ron was ordered to pay child support in the sum of $600 per month. He was further ordered to pay $600 per month to Charlene in alimony.[2] Charlene was ordered to maintain medical insurance for the children and to pay all of their medical bills.
On October 8, 2002, Ron filed an application to modify the child support and alimony provisions of the parties’ dissolution decree. On November 4, 2002, an order for medical support was entered by consent of the parties. The terms of this order required Ron to provide medical insurance for Justin and Jessica and pay $100 a month to Charlene as medical support for Joshua. Charlene was ordered to pay the first $500 of the children’s uncovered medical expenses. Ron was responsible for seventy-two percent of the uncovered medical expenses after the initial $500.
A trial on the issues of alimony, child support, and medical support commenced on May 27, 2004. On June 3, 2004, the district court entered an order modifying the parties’ dissolution decree. Ron was granted primary physical care of Justin.[3] In computing the amount of Charlene’s child support obligation, the district court imputed $12,480 in income to her based on her earning capacity. Ron was ordered to pay $117 per month in child support to Charlene, the net difference between the parties’ support obligations after imputing income to Charlene. The order further reduced Ron’s alimony obligation to $400 per month and terminated his obligation to pay $100 per month in medical support to Charlene. Additionally, all uncovered medical expenses were to be paid for equally by the parties. It is from this order that Charlene appeals.
II. Scope of Review.
Our review of a district court’s ruling on an application for modification of a dissolution decree is de novo. In re Marriage of Walters, 575 N.W.2d 739, 740 (Iowa 1998). We examine the entire record and adjudicate anew issues properly presented. In re Marriage of Steenhoek, 305 N.W.2d 448, 452 (Iowa 1981). We give weight to the fact findings of the trial court, especially when considering the credibility of witnesses, but are not bound by them. Iowa R. App. P. 6.14(6)(g).
III. Calculation of Child Support.
Charlene avers the trial court incorrectly calculated the amount of child support owed by each of the parties. Specifically, Charlene contends the trial court incorrectly imputed income to her based on her potential earning capacity. She further argues special circumstances warrant an upward adjustment of Ron’s support obligation. We address each of her arguments in turn.
Before using earning capacity rather than actual earnings a court must make a determination that, if actual earnings were used, substantial injustice would occur or adjustments would be necessary to provide for the needs of the child and to do justice between the parties. See In re Marriage of Bergfeld, 465 N.W.2d 865, 870 (Iowa 1991); In re Marriage of Flattery, 537 N.W.2d 801, 803 (Iowa Ct.App. 1995). We examine the employment history, present earnings, and reasons for failing to work a regular workweek when assessing whether to use the earning capacity of a parent. Iowa Dep’t of Human Servs. ex rel. Gonzales v. Gable, 474 N.W.2d 581, 583 (Iowa Ct.App. 1991). We agree with the district court’s conclusion that application of the Child Support Guidelines without imputing income to Charlene would be unjust under the circumstances of this case. Due to Joshua’s medical condition, Ron is responsible for paying additional expenses. Although Joshua is covered under Title XIX, Ron is required to pay for one-half of any uncovered medical expenses. Ron is further obligated to provide medical insurance for the other two children. Because Ron is required to pay for medical insurance and cover additional medical expenses, utilizing Charlene’s actual earnings to calculate the parties’ child support obligations would result in substantial injustice. This is especially true in light of the fact that Charlene is mentally and physically capable of working full-time. Although she has not worked outside the home since 1987 when the parties married, she has a high school education and a two-year degree from Kirkwood Community College. Charlene argues Joshua’s medical condition prevents her from working outside the home. However, the record does not support this conclusion. Joshua is thirteen years of age and is able to self-administer the treatments he requires. In addition, the Cedar Rapids Community School District has developed a written health services protocol because of Joshua’s special circumstances that ensure Charlene will be contacted immediately upon the development of certain symptoms or injuries. Both Charlene and Joshua carry cellular telephones so that they can maintain contact with each other in the event of an emergency. Thus, we conclude, as did the district court, that imputing income to Charlene is appropriate in this case because if her actual earnings were used substantial injustice would result to Ron in light of the additional financial burdens imposed upon him.
Charlene further claims special circumstances warrant an upward adjustment of child support. She points to the fact that Ron is living with his girlfriend in a marriage-like arrangement. She further highlights the fact that Ron pays his girlfriend a salary of $15,000 to $17,000 a year for working as his secretary. Charlene also argues that because Ron is self-employed, his income is actually much higher than reported because he is able to take generous deductions for business expenses, such as depreciation. There is a rebuttable presumption that the amount of child support that would result from application of the guidelines is correct. See Iowa Code § 598.1(4) (2001). A court cannot vary the amount of the child support prescribed by the guidelines without a written finding that application of the guidelines would be unjust or inappropriate under the “special circumstances” of the case. Upon our de novo review of the record, we find Charlene’s arguments to be without merit and conclude a departure from the Child Support Guidelines is unwarranted.
IV. Modification of Alimony.
As previously noted, the district court reduced Ron’s alimony obligation from $600 to $400. Charlene argues this was in error. Under Iowa Code section 598.21(8) (2001), an alimony award may be modified if there has been a material and substantial change in circumstances. A party seeking modification must prove the change in circumstances by a preponderance of the evidence. In re Marriage of Rietz, 585 N.W.2d 226, 229 (Iowa 1998). We are guided by the following well-established principles when considering a petition for modification:
(1) there must be a substantial and material change in the circumstances occurring after the entry of the decree; (2) not every change in circumstances is sufficient; (3) it must appear that continued enforcement of the original decree would, as a result of the changed conditions, result in positive wrong or injustice; (4) the change in circumstances must be permanent or continuous rather than temporary; (5) the change in financial conditions must be substantial; and (6) the change in circumstances must not have been within the contemplation of the trial court when the original decree was entered.
In re Marriage of Cooper, 524 N.W.2d 204, 206 (Iowa Ct.App. 1994) (citation omitted).
Ron argues a substantial change in circumstances has occurred because he has experienced a reduction in his annual income. However, upon the entry of the original dissolution decree, Ron was self-employed. Thus, Ron’s fluctuating income due to his self-employed status was clearly within the contemplation of the trial court when the original decree was entered. Ron further points to the fact that in January 2004, he lost the business of a major client, which had been providing him with approximately $3000 per month in gross revenue. We conclude, as did the district court, that this fact does not constitute a material and substantial change in circumstances. Although Ron stands to lose a significant amount of revenue, this loss is temporary and can be adjusted for by seeking other customers or reducing expenses for wages and contract labor.
Further, although Ron is now responsible for paying additional medical expenses and insurance, this newly incurred obligation has already been considered and taken into account by adjusting the child support obligations of the parties. Thus, upon our de novo review of the record, we conclude there has not been a substantial change in circumstances that justifies a change in alimony, in addition to a change in Ron’s child support obligation. Accordingly, we reverse the trial court’s modification of Ron’s alimony obligation.
V. Appellate Attorney Fees.
Charlene requests an award of appellate attorney fees. An award of appellate attorney fees is not a matter of right but rests within our discretion. In re Marriage of Scheppele, 524 N.W.2d 678, 680 (Iowa Ct.App. 1994). In determining whether to award appellate attorney fees, we consider the needs of the party making the request, the ability of the other party to pay, and whether the party making the request was obligated to defend the decision of the trial court on appeal. Id. We deny Charlene’s request for attorney fees. Costs on appeal are taxed one-half to each party.
AFFIRMED IN PART AND REVERSED IN PART.