Holleman v. Barrilleaux

161 So. 3d 789, 14 La.App. 3 Cir. 499, 2014 WL 6675746, 2014 La. App. LEXIS 2791
CourtLouisiana Court of Appeal
DecidedNovember 19, 2014
DocketNo. 14-499
StatusPublished
Cited by1 cases

This text of 161 So. 3d 789 (Holleman v. Barrilleaux) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Holleman v. Barrilleaux, 161 So. 3d 789, 14 La.App. 3 Cir. 499, 2014 WL 6675746, 2014 La. App. LEXIS 2791 (La. Ct. App. 2014).

Opinion

SAUNDERS, Judge.

| ,This is an appeal by Natalie Louise Barrilleaux from the trial court’s award of [791]*791$1,922.95 per month for the support of the parties’ minor daughter.

FACTS AND PROCEDURAL HISTORY

Natalie Louise Barrilleaux (hereafter “Appellant”) and Lindley Scott Holleman (hereafter “Appellee”) are the parents of a minor daughter, Rowan Grace Barrilleaux. Appellant is employed by Dr. William Andre Cenac as an office manager. Appellee is a member in Hollemire International, LLC (hereafter “Hollemire”), in which he has a fifty percent interest, and of Private Workforce Solutions, LLC (hereafter “Private Workforce”). Additionally, Appellee has an interest in a family trust fund.

On May 1, 2013, Appellee filed a Petition for Paternity and Custody. Appellee filed a reconventional demand, seeking sole custody and child support. Following two hearing officer conferences, Appellee was ordered to pay $1,497.00 per month in support of the child. Appellee’s gross income was calculated to be $10,000.00 per month. Appellant objected to the Hearing Officer’s Recommendations, which were made a temporary order of the court on August 27, 2013.

A hearing was held on September 11, 2013. Appellee testified that he received a salary of $10,000.00 per month from Holle-mire, made multiple additional draws from Hollemire, and did not receive any income from the family trust. Schedule K-l from Private Workforce indicates distributions in the amount of $6,737.00 were made to Appellee in 2012. Appellee was ordered to pay $1,922.95 per month in support of the child. The district judge found Appellant’s gross income from Dr. Cenac 'to be $4,766.67 per month. The trial court found Appellee’s gross income to be $15,500.00 per month, which included his salary of |2$10,000.00 per month from Hol-lemire, an unspecified amount of the “draws” taken from Hollemire in addition to his salary, and his ownership interest in Hollemire. It is from this judgment that this appeal arises.

Appellant asserts the trial judge erred in finding Appellee’s gross income to be $15,500.00 per month. Appellant urges us to find that Appellee’s gross income includes his salary and draws from Holle-mire, the net undistributed profits of Hol-lemire, the direct payments of Appellee’s personal expenses by Hollemire, and the distributions from Private Workforce. She requests we adjust the child support award accordingly.

DISCUSSION

In Baggett v. Baggett, 96-453 (La.App. 3 Cir. 4/23/97), 693 So.2d 264, 266, we noted that there is a “three tiered standard” to be applied by an appellate review of a child support award. We explained:

When we review a trial judge’s decision in a case such as the present, we must make three determinations, under three different standards of appellate review. First, we must determine whether the trial judge correctly applied the proper legal standard or standards. We do not defer to the discretion or judgment of the trial judge on issues of law. Second, we must examine the trial judge’s findings of fact. We will not overturn the trial judge’s factual determinations unless, in light of the record taken as a whole, they are manifestly erroneous (or clearly wrong). Third, we must examine the propriety of the alimony award. If it is within legal limits and based on facts supported by the record, we will not alter the amount of the award in the absence of an abuse of the trial judge’s great discretion to set such awards.

Id. at 266-67 (quoting Davy v. Davy, 469 So.2d 481 (La.App. 3 Cir.1985)).

[792]*792APPELLEE’S GROSS INCOME

We conclude the trial court committed legal error in failing to include in the calculation of Appellee’s gross income the undistributed profits of Hollemire. Louisiana Revised Statutes 9:315, et. seq. provides that the combined adjusted |3gross income of both parties is used to determine the basic child support obligation. “Adjusted gross income” includes the gross income of the parties. La.R.S. 9:315(0(1). Gross income includes:

(a) The income from any source, including but not limited to salaries ...;
(b) Expense reimbursement or in-kind payments received by a parent in the course of employment, self-employment, or operation of a business, if the reimbursements or payments are significant and reduce the parent’s personal living expenses. Such payments include but are not limited to a company car, free housing, or reimbursed meals; and
(c) Gross receipts minus ordinary and necessary expenses required to pro-ducé income.... “Ordinary and necessary expenses” shall not include amounts allowable by the Internal Revenue Service for the accelerated component of depreciation expenses....

La.R.S. 9:315(C)(3)(emphasis added). Although not required, regular depreciation may be counted as an “ordinary and necessary expense” appropriate for use in calculating a self-employed individual’s gross income. Riggs v. LaJaunie, 98-304 (La.App. 3 Cir. 10/7/98), 720 So.2d 114; Dejoie v. David Guidry, 10-1542 (La.App. 4 Cir. 7/13/11), 71 So.3d 1111.

After reviewing Hollemire’s 2012 tax returns, Scott Soileau, a CPA hired by Appellant to provide expert testimony on her behalf, testified that the Hollemire’s gross income less expenses for 2012 was $508,000.00. Included in this number was $7,400.00 in regular depreciation, $64,579.00 in accelerated depreciation, and charitable contributions deducted by Hol-lemire. The payoff of a large line of credit was deducted from the gross receipts of Hollemire for the year 2012. Although Appellant urges us to exclude the payoff as an “ordinary and necessary” business expense, we note that Appellant’s expert included it as a deduction in his assessment of Hollemire’s income for 2012. Therefore, we conclude the trial court |4did not err in allowing this expense as a deduction from Hollemire’s gross receipts for 2012. Although not required, we conclude that the regular depreciation is appropriately countable as an “ordinary and necessary” expense and decline to include it in Holle-mire’s income for 2012. Thus, we calculate the net profits of Hollemire to be $500,600.00, which is the $508,000.00 less the $7,400.00 in regular depreciation. As an equal member, Appellee’s share of this amount is $250,300.00. This is the actual amount of the profit that remained in Ap-pellee’s control, and he was able to choose whether to withdraw it or leave it in the business. This translates into $20,858.33 per month. This amount clearly falls into the definition of gross income under La. R.S. 9:315(0(3) and the trial court erred in failing to include this number in the calculation of Appellee’s statutorily defined gross income.

We further conclude that the trial court erred in failing to include the distributions from Private Workforce in the calculation of Appellee’s gross income. Although the tax return for Private Workforce from which the above Schedule K-l data was derived was not introduced in evidence, there is no real dispute between the parties that the Schedule K-l information represents the share of Ap-pellee’s profits in the company for 2012. Schedule K-l from Private Workforce for 2012 indicates distributions were made to [793]*793Appellee in the amount of $6,737.00 in 2012. This translates to $561.41 per month.

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Bluebook (online)
161 So. 3d 789, 14 La.App. 3 Cir. 499, 2014 WL 6675746, 2014 La. App. LEXIS 2791, Counsel Stack Legal Research, https://law.counselstack.com/opinion/holleman-v-barrilleaux-lactapp-2014.