Rodney Emil Deane v. Regenia Lynn Deane

• Court: Court of Appeals of Virginia
• Decided: July 20, 1999
• Docket: 2347982
• Status: Unpublished

Opinion

COURT OF APPEALS OF VIRGINIA

Present: Judges Coleman, Elder and Bumgardner Argued at Salem, Virginia

RODNEY EMIL DEANE MEMORANDUM OPINION * BY v. Record No. 2347-98-2 JUDGE SAM W. COLEMAN III JULY 20, 1999 REGENIA LYNN DEANE

FROM THE CIRCUIT COURT OF ALBEMARLE COUNTY Paul M. Peatross, Jr., Judge

William C. Scott IV (Ronald R. Tweel; Michie, Hamlett, Lowry, Rasmussen & Tweel, on briefs), for appellant.

John K. Taggart, III (Patricia D. McGraw; Tremblay & Smith, LLP, on brief), for appellee.

Following the entry of a final divorce decree on May 19,

1997, Rodney Emil Deane (husband) and Regenia Lynn Deane (wife),

filed numerous post-decree motions requesting that the trial

court correct errors on the face of the record, clarify its

rulings, and modify child and spousal support. As a result, the

trial court entered a decree on September 16, 1998, modifying

child and spousal support nunc pro tunc. The modification

created instant support arrearages. That decree also found that

no agreement existed between the parties to divide certain

*Pursuant to Code § 17.1-413, recodifying Code § 17-116.010, this opinion is not designated for publication. marital assets and further found that it no longer had

jurisdiction to equitably divide those assets since the divorce

decree had became final for more than twenty-one days.

Husband appeals the September 16, 1998 decree contending

that the trial court lacked jurisdiction to modify support and,

alternatively, that it erred in calculating the appropriate

modification and resulting arrearages. Wife, who also appeals,

contends that the trial court erred by finding that the parties

had not agreed on an equitable division of certain marital

assets. Alternatively, she asserts that the trial court ordered

that all marital assets be equally divided and that ruling

controls the assets in question.

We find that the trial court did not err in holding that

the final divorce decree did not equitably divide certain

marital assets and that the parties did not enter into an

enforceable equitable distribution agreement. As to the child

and spousal support issues, we find that the trial court had

jurisdiction to modify support prospectively from the date the

motion to modify was filed, but did not have authority to modify

support retroactively. Finally, we find that the trial court

erroneously calculated the adjustment to the spousal support

award. Accordingly, we affirm the trial court's rulings in

part, but reverse the spousal support ruling and remand the case

for the trial court to correct the modification of the spousal

support award.

- 2 - BACKGROUND

Wife filed a bill of complaint for divorce. Following ore

tenus hearings, the trial court entered a final divorce decree

on May 19, 1997, which neither party appealed. The final decree

awarded wife $698.28 per month for child support and $924.06 per

month for spousal support. Also, the decree, which equitably

distributed some of the parties' marital property and debt, did

not reserve the right to distribute the remaining marital

property as authorized by Code § 20-107.3(A). See Christensen

v. Christensen, 26 Va. App. 651, 654-55, 496 S.E.2d 132, 133

(1998).

On September 24, 1997, wife filed a "Motion to Correct

Errors" apparent on the face of the record. The motion asserted

that the final decree had failed to include a provision setting

forth the trial court’s spousal support award and that the trial

court failed to include a provision dividing certain marital

property, namely Mercury Services, Express Car Wash Company, and

Express Charlottesville (hereinafter, the "undivided assets").

After hearing evidence on wife's "Motion to Correct

Errors," the trial court ruled that the final decree contained a

ministerial error in that it omitted the court's prior ruling

awarding spousal support. Additionally, after reviewing the

transcripts, the court ruled that the parties had reached no

agreement regarding the undivided marital assets, and therefore,

the court had not erred in the final decree by omitting a

- 3 - provision enforcing the purported agreement or by refusing to

divide those assets. Thus, the trial court entered a decree on

October 24, 1997, incorporating these rulings. Neither party

appealed that decree.

On December 2, 1997, wife filed a "Motion for

Clarification" in which she alleged that in the October 24, 1997

decree the trial court failed to

address the issue of whether the respondent continues to be obligated under the May 19, 1997, order to divide income with the Complainant as provided therein 1 and if the court so finds, whether he is in contempt of court for failure to either pay her any funds from these assets for the last year or to provide her any accounting of the same.

Wife asserted in her motion to clarify "[t]hat in computing

child and spousal support, the Court added $3,658.00 of unearned

income to Complainant’s salary from those [undivided] assets,

however, Complainant has never receive[d] any income" from those

assets after entry of the final decree. In other words, the

court had based its support award upon the fact that at the time

of the award wife was receiving one-half of the income from the

undivided marital assets, which husband stopped paying her after

entry of the final divorce decree. Wife requested that the

1 The May 19, 1997 decree incorporated the trial judge's May 6, 1997 letter opinion in which the court made a finding as to the parties’ respective incomes for the purpose of calculating support. In the opinion letter, the trial court allocated half the income to each spouse from each of the "undivided assets."

- 4 - trial court either order husband to pay one-half the accrued

income from the undivided assets or to modify the support award

nunc pro tunc to reflect that she had not received the income

but husband had retained it.

On May 26, 1998, the trial court ruled on the "Motion for

Clarification" in a letter opinion which stated that as to

"equitable distribution of the property of the parties, the

Court finds the parties never did agree to a division of [the

undivided assets]" and "[t]here has been no division of those

assets by the Court." As to spousal support, the court noted

that it had calculated the wife's support award based upon the

fact that the parties were equally dividing the income from the

undivided assets and the assumption that the equal division

would continue.

On July 16, 1998, the trial court conducted a hearing

concerning the undivided marital assets and whether to adjust

the child and spousal support awards in light of the fact the

wife did not receive the asset income and that the husband had

received this additional income.

Based upon the parties' revised income statements, the

trial court ruled that both parties agreed that the wife had not

received a substantial portion of the asset income upon which

both support awards had been based. The court found that this

constituted a material change in circumstances justifying

modification of the support obligations as authorized by Code

- 5 - §§ 20-108 and 20-109(A). Based on the revised income

statements, the trial court recalculated the parties’ incomes

and ordered an increase in child support effective nunc pro tunc

to November 1, 1996, which was the effective date of the

original support award. The modification resulted in the

husband owing wife child support arrearage.

As to spousal support, the trial court had determined in

its May 6, 1997 letter opinion that wife’s after-tax child and

spousal support need totaled $1,432. Because at the time of the

July 16, 1998 hearing wife was earning $298.33 per month less

than the trial court had contemplated in it prior award, the

trial court added $298.33 to the previous combined awards of

$1,432 resulting in a new combined income need of $1,730.33.

The court then subtracted the newly calculated child support

figure ($728.98) from the newly calculated combined need

resulting in a net spousal support need of $1,001.35. Then,

adjusting for income taxes at the rate previously considered,

the trial court adjusted the spousal support award nunc pro tunc

from $1,001.35 to $1,253.69. The court modified the award

effective to November 1, 1996, the effective date of the

original support award. As a result of the modification,

- 6 - husband owed wife a total child and spousal support arrearage of

$7,662.19. 2

As to the undivided assets, which the court had previously

found not to be affected by an agreement between the parties,

the court ruled that the properties were owned solely by

husband. The court further held that it had no authority to

divide these assets or to make a monetary award pursuant to Code

§ 20-107.3(C) or (K). Both parties objected to the court's

rulings and decree. Husband claims that the trial court's

rulings and decree as to child and spousal support were barred

by Rule 1:1 and that the court erred in calculating the support

modification. Wife claims that the trial court erred by

refusing to honor the parties' agreement to equally divide the

undivided assets or to equally divide those assets in accordance

with its ruling.

2 Ordinarily, to calculate child support a court must include spousal support in the gross income of the receiving spouse and deduct spousal support from the gross income of the paying spouse. See Frazer v. Frazer, 23 Va. App. 358, 381, 477 S.E.2d 290, 301 (1996). Accordingly, a trial court should first calculate spousal support and then child support. Here, however, husband explicitly waived his right to have the trial court consider spousal support in calculating child support. The court began by establishing wife's after-tax total income need and thereafter subtracted from that figure child support to arrive at her spousal support need. Unconventional though this method was, the husband expressly consented to it.

- 7 - ANALYSIS

Jurisdiction to Modify Support

A trial court has continuing jurisdiction to modify child

and spousal support upon finding that a material change in

circumstances warrants modification. See Code § 20-108;

§ 20-109; Furr v. Furr, 13 Va. App. 479, 481, 413 S.E.2d 72, 73

(1992); Watkinson v. Henley, 13 Va. App. 151, 156, 409 S.E.2d

470, 472-73 (1991).

Husband contends that because neither party moved for

modification, the issue was not properly before the court. We

disagree and find that the trial court had authority and

jurisdiction to modify child and spousal support in its

September 16, 1998 decree.

In regard to child support, Code § 20-108 specifically

states that the court may modify a support award on its own

motion. Notwithstanding that provision, we find that wife's

"Motion for Clarification" placed the issues of child and

spousal support modification before the court. In that motion,

wife requested that the trial court order husband to pay wife

one-half the income from the undivided assets "or in the

alternative to recompute child support and spousal support nunc

pro tunc to May 19, 1997, to accurately reflect that the only

income she receives is from her salary." We find this motion,

- 8 - filed December 2, 1997, constitutes a motion to modify child and

spousal support on behalf of wife. 3

Authority to Modify Retroactively

Although the trial court had jurisdiction to modify spousal

support, the trial court erred by ordering the modification

effective retroactively to November 1, 1996. A trial court only

has authority to modify child and spousal support prospectively

from the date of filing of the petition for modification. See

Code § 20-108 ("No [child] support order may be retroactively

modified."); Code § 20-109 (granting the trial court authority,

upon petition of either party, to modify spousal support "that

may thereafter accrue" (emphasis added)); Reid v. Reid, 245 Va.

409, 414, 429 S.E.2d 208, 211 (1993). The "Motion for

Clarification" was filed December 2, 1997; the trial court could

only modify the support awards effective as of that date.

Calculating the Modifications

Additionally, we find that the trial court erred in

calculating the correct modification of spousal support. A

3 We reject wife’s assertion that the trial court had authority to "correct" the decreed support awards pursuant to Code § 8.01-428(B). The original support awards were not errors apparent on the face of the record that could be corrected without further litigation. See Cutshaw v. Cutshaw, 220 Va. 638, 641, 261 S.E.2d 52, 53 (1979) (stating that the trial court has the authority to correct the record "when the record clearly supports such correction"). The trial court based the original support awards on the evidence of the parties’ income. The trial court based the modification on new evidence of income.

- 9 - spouse’s entitlement to a spousal support award and the amount

of that award are committed to the sound discretion of the

judge. See Stubblebine v. Stubblebine, 22 Va. App. 703, 707,

473 S.E.2d 72, 74 (1996). The only changes of circumstances

were that wife’s income had decreased by $298.33 and husband’s

income had increased by $298.33.

First, using the statutory child support guidelines and the

parents' modified income figures, the trial court modified

husband's child support obligation from $694.28 to $728.98 per

month. Next, to calculate the modified spousal support award,

the trial court determined that it would award wife the same

after-tax child and spousal support that it had previously

awarded, which was $1,432. 4 Because wife was in fact receiving

$298.33 less income than the trial court had contemplated when

it determined her combined after-tax support need, the trial

court added $298.33 to the combined need figure resulting in a

new combined need of $1,730.33 ($298.33 + $1,432.00 =

$1,730.33). The court subtracted the newly calculated child

4 The trial court had previously ordered $694.28 of child support and $924 of spousal support, which resulted in the total support figure of $1,432 (after applying a 20.13% tax to spousal support). In the May 6, 1997 letter opinion, the trial court refers to a tax rate that wife agreed to in an April 18, 1997 letter that is not in the record. Although the court did not articulate that rate, it appears to have applied a 20.13% tax. In the September 16, 1998 decree, the trial court again calculated the tax at the same 20.13% rate. We, therefore, accept that rate in our review and calculations.

- 10 - support ($728.98) from the newly calculated combined need

resulting in a figure of $1,001.35 ($1,730.33 - $728.98 =

$1,001.35). Then, adjusting for income taxes at the 20.13%

rate, the trial court adjusted the spousal support from

$1,001.35 to $1,253.69.

We find that the trial court intended to modify the support

awards in a manner that would provide wife the same net monthly

income that the trial judge had contemplated in the May 6, 1997

award. However, based on our review of the calculation, it

appears that the modification resulted in a net combined support

award greater than the net award contemplated in the previous

decree -- the error resulting from the fact that the trial court

compensated for wife's $298.33 decrease in taxable income by

awarding her a $298.33 increase in after-tax income.

According to our calculation, wife’s monthly income as

contemplated by the May 6, 1997 opinion letter would have been

as follows: her taxable income exclusive of support was

$2,957.50; her spousal support was $924; thus, her taxable

income was $3,881.50 ($2,957.50 + $924.00 = $3,881.50).

Applying the 20.13% tax, her net after-tax monthly income and

support was $3,100.15. The trial court awarded child support at

$694.28. Thus, wife's total after-tax monthly income and

support was $3,794.15.

Under the September 16, 1998 modified award, the trial

court determined that wife’s income exclusive of support was

- 11 - $2,659.17. The trial court awarded spousal support of

$1,253.69. Thus, wife’s monthly taxable income was $3,912.86

($2,659.17 + $1,253.69 = $3,912.86). Applying the 20.13% tax

rate, her after-tax income, exclusive of child support, would be

$3,125.20. The trial court awarded child support of $728.98.

Therefore, her total after-tax monthly income, as modified,

would be $3,854.18. Accordingly, the September 16, 1998 decree

awarded wife $60.03 more net income per month than the trial

court had contemplated in its May 6, 1997 award

($3,854.18 - $3,794.15 = $60.06). 5

The Undivided Assets

Finally, we hold that the trial court did not err in its

September 16, 1998 decree by refusing (1) to divide the

5 In order to modify wife’s spousal support so that she would receive the monthly income contemplated under the May 6, 1997 award, the trial judge should have awarded wife $1,178.53 in spousal support. That figure is calculated as follows: the target after-tax monthly income was $3,794.15. The court awarded the modified child support in the amount of $728.98. Thus, wife needed an additional $3,065.17 of after-tax dollars in order to receive $3,794.15 ($3,794.15 - $728.98 = $3,065.17). Wife's modified income exclusive of all support and adjusted for tax was $2,123.88 ($2,659.17 – [.2013 x $2,659.17] = $2,123.88). Thus, in order to attain the contemplated total net monthly income, wife required a spousal support award that would increase her net income by $941.29 ($3,065.17 – $2,123.88 = $941.29). Adjusted for taxes, a spousal support award of $1,178.53 yields the requisite after-tax amount of $941.29 ($1,178.53 – [.2013 x $1,178.53] = $941.29). Thus, in order to adjust for the wife's $298.33 monthly decrease in taxable income, the trial court would have needed to modify the spousal support award from $924 to $1,178.53 instead of $1,253.69.

- 12 - undivided marital assets, (2) to order a monetary award for

wife’s interest in the undivided marital assets, or (3) to order

husband to pay her one-half the income from the undivided

assets. On May 19, 1997, the trial court entered a final decree

that addressed all matters of equitable distribution. In that

decree the trial court did not divide the undivided assets, did

not incorporate or recognize any agreement between the parties

which divided those assets, did not award a division of the

income from those assets, did not order a monetary award to wife

for her share of the value in the undivided assets, and did not

retain jurisdiction over matters of equitable distribution.

Neither party appealed the decree and it became final twenty-one

days after its entry. See Rule 1:1.

Accordingly, on December 2, 1997, when wife requested that

the trial court revisit the division of income from the

undivided assets, the trial court had no jurisdiction to do so.

Therefore, the trial court did not err by refusing to revisit

the issues in the September 16, 1998 decree which the parties

presently appeal.

CONCLUSION

In summary, we hold that the trial court had authority to

modify the child and spousal support awards prospectively and

retroactively until December 2, 1997. Therefore, on remand the

arrearage resulting from the modification shall be determined as

of that date. Additionally, we find that the trial court erred

- 13 - by compensating for a $298.33 reduction in taxable income by

creating a $298.33 increase in after-tax income. Thus, on

remand the trial court shall modify its spousal support award in

accordance with the conclusions of this opinion. We hold that

the trial court did not err in refusing to equitably distribute

the undivided assets in the September 16, 1998 decree. Finally,

we find both parties had reasonable grounds for this appeal and,

therefore, we deny their respective requests for awards of

attorneys' fees. See Gayler v. Gayler, 20 Va. App. 83, 87, 455

S.E.2d 278, 280 (1995). Accordingly, we affirm in part but

reverse and remand the spousal support award for entry of a

decree consistent with this opinion.

Affirmed, in part, reversed and remanded, in part.

- 14 -