Two published decisions last week ruled on the whether to award child support upon combined parental income in excess of the base child support amount. In the first, the Second Department in Beroza v. Hendler, found it was an improvident exercise of discretion for the trial court to have capped the parties’ combined parental income at $255,000.00. On appeal, the Second Department increased the cap to $400,000.00 and awarded the mother the father’s pro rata portion of that capped amount.
In the second case, A.C. v. J.O. (to be the subject of Wednesday’s blog post), Acting Kings County Supreme Court Justice Debra Silber, determined that although the parents had net combined parental income of $423,100.00, the father’s child support obligation would be limited to his pro rata share of the $136,000.00 cap.
In Beroza, the father had commenced this divorce action in 2001 after 11 years of marriage. At that time the oldest of the parties’ three children was 4½ years old and their twins were 18 months old. The parties were both educated professionals. The father was a veterinarian with a private practice devoted to horses and a related horse-boarding business and the mother was a partner in a group anesthesiology practice. Both parties worked throughout the marriage. the family enjoyed an affluent lifestyle in Laurel Hollow.
Underlying the parties’ 2008 divorce judgment, Nassau County Supreme Court Justice Ira Warshawsky imputed gross annual income to the father of $259,100.00. The father’s base annual child support obligation was fixed at as 29% of $200,000.00, or $4,833.33 monthly.
On the husband’s appeal from the 2008 judgment, the Second Department agreed with amount of the father’s imputed annual gross income, but remitted the matter to the Supreme Court because it had failed to properly set forth the parties’ pro rata shares of child support. Additionally, the lower court failed to adequately explain its application of the “precisely articulated, three-step method for determining child support’” pursuant to the Child Support Standards Act (Beroza v Hendler, 71 AD3d 615, 617, 896 N.Y.S.2d 144 ).
On remittitur, Justice Warshawsky re-determined the parties’ respective annual net C.S.S.A. incomes to be $248,721.00 for the father and $487,693.00 for the mother, for net combined parental income of $736,414.00. However, for the purpose of determining the plaintiff’s child support obligation, the court capped combined parental income at $255,000.00.
Justice Warshawsky found that $255,000.00 adequately reflected a support level that met the needs and continuation of the children’s lifestyle, as dictated by the past spending practices of the parties. Justice Warshawsky applied the 29% statutory percentage to combined parental income capped at $255,000.00 ($73,950.00 total support obligation), and the calculated that the husband’s 33.7% pro rata support obligation at $24,921.00, annually, or $2,076.75, monthly.
The Second Department modified. Although he had articulated his analysis pursuant to the three-step method for determining child support embodied in the C.S.S.A. guidelines, Justice Warshawsky, the appellate court held, improvidently exercised his discretion in capping the parties’ combined parental income at $255,000.00.
Proper consideration of the D.R.L. §240(1-b)(f) factors did not support the lower court’s finding that a monthly support obligation of $2,076.75 “adequately reflects a support level that meets the needs and continuation of the children’s lifestyle, as dictated by the past spending practices of the parties.”
Instead, the Second Department deemed it appropriate to conduct its own review of the record, which it found sufficiently developed, and to recalculate the father’s child support obligation for his three children.
Under the first of the three-step analysis, the court determined the parties’ combined parental income. Here, net combined parental income of $736,414.00 was not in dispute.
The appellate court determined the father’s pro rata share at the more precise 33.77% (dividing $248,721.00 by $736,414.00), not the rounded percentage of 33.7% applied by Justice Warshawsky.
Under the second step of the analysis, the appellate court multiplied so much of the combined parental income up to $80,000.00—which was the “statutory cap” in effect on the date of the 2008 judgment by the applicable statutory child support percentage, or 29% for the parties’ three children. The court, then, allocated the resulting amount of $23,200.00 between the parties according to their pro rata shares of the combined parental income. The plaintiff’s share of the basic annual support obligation was 33.77% of $23,200.00, or the annual sum of $7,834.64.
The third step in the analysis was also to be applied as the combined parental income exceeded the applicable statutory limit of $80,000.00. In this situation, “courts [have] the discretion to apply the [sub]paragraph (f)’ factors, or to apply the statutory percentages, or to apply both in fixing the basic child support obligation on parental income over $80,000.” As applicable here, the subparagraph (f) factors include a consideration of the financial resources of the custodial and noncustodial parent, and the standard of living the child would have enjoyed had the marriage or household not been dissolved.
These factors further the objectives of the CSSA, which include “the assurance that both parents would contribute to the support of the children” and that the court consider “the total income available to the parents and the standard of living that should be shared with the child.”
Here, it was a provident exercise of discretion to apply the statutory child support percentage of 29% to the amount of the combined parental income it considered in excess of $80,000.00, but it was an improvident exercise of discretion for Justice Warshawsky to have capped the amount of combined parental income at $255,000.00, an amount which was only marginally higher than the plaintiff’s net annual income of $248,721.00. The capped amount, in effect, improperly excluded consideration of the mother’s net annual income of $487,693. This was contrary to the cost-sharing scheme directed by the C.S.S.A.
Considering the relevant subparagraph (f) factors, including the affluent lifestyle which the children undisputedly enjoyed during the parties’ marriage, commensurate with the parties’ education and net combined annual parental income of $736,414.00, the Second Department found that $400,000.00 was an appropriate cap to the parties’ combined annual parental income for purposes of calculating the plaintiff’s support obligation pursuant to the statutory percentage.
Thus, under step three, the Second Department applied the child support percentage of 29% to the amount of the cap in excess of $80,000.00, or $320,000.00. That yielded the annual amount for both parents of $92,800.00. The father’s 33.77% share of the excess was $31,338.56. Adding that amount to the father’s basic annual support obligation of $7,834.64 yielded an annual obligation of $39,173.20, or $3,264.43 per month.