Net Combined Parental Income

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 [2010]).

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.

Continue Reading $400,000 Combined Parental Income Cap Imposed by Second Department when Determining Father’s Child Support Obligation