Title: LISA LAUDERMAN V. STATE OF WYOMING, DEPARTMENT OF FAMILY SERVICES ex rel. JEN, a minor child and RUSSELL NOMURA

State: wyoming

Issuer: Wyoming Supreme Court

Document:

LISA LAUDERMAN V. STATE OF WYOMING, DEPARTMENT OF FAMILY SERVICES ex rel. JEN, a minor child and RUSSELL NOMURA2010 WY 70Case Number: S-09-0100Decided: 05/28/2010NOTICE:  This opinion is subject to formal revision before publication in Pacific Reporter Third.  Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.
APRIL 
TERM, A.D. 2010

 
 
LISA 
LAUDERMAN,Appellant(Respondent),v.STATE OF WYOMING, 
DEPARTMENT OF FAMILY SERVICES ex rel. JEN, a minor 
child,Appellee(Petitioner),andRUSSELL 
NOMURA,Appellee(Respondent).

 
 
Appeal 
from the District Court of Park County

The 
Honorable Steven R. Cranfill, Judge

 
 

Representing 
Appellant:

Wendy 
Press Sweeny of Wendy Press Sweeny, Attorney at Law, P.C., Worland, 
Wyoming

 
 

Representing 
Appellee State of Wyoming, Department of Family Services ex rel JEN, a minor 
child:

Bruce 
A. Salzburg, Wyoming Attorney General; Robin Sessions Cooley, Deputy Attorney 
General; Jill E. Kucera, Senior Assistant Attorney General; Elisabeth B. Lance, 
Assistant Attorney General

 
 

Representing 
Appellee Russell Nomura:

David 
M. Clark, of Worrall & Greear, P.C., Worland, Wyoming

 
 
Before 
VOIGT, C.J., and GOLDEN, HILL, KITE, BURKE, JJ.

 
 
GOLDEN, 
J., delivers the opinion of the Court; HILL, J., files a dissenting 
opinion.

 
 

GOLDEN, 
Justice.

 
 
[¶1]      Lisa Lauderman, 
(Mother) and Russell Nomura (Father) have one child.  The Department of Family Services (DFS) 
filed a motion to modify child support.  
After a hearing, the district court reduced Father's child support 
obligation.  Mother appeals.  We affirm.

 
 
ISSUES

 
 
[¶2]      Mother presents 
multiple issues, but they can be reduced into two main issues.  First, Mother argues the district court 
abused its discretion in calculating the parties' respective incomes.  Second, Mother argues the district court 
abused its discretion in admitting certain letters into 
evidence.

 
 
FACTS

 
 
[¶3]      Mother and Father 
never married but they had one child together in 1999.  Mother has always had custody of the 
child.  In 2004, Father's child 
support obligation was set at $263.00 per week.  In early 2007, Father fell $3,419.00 in 
arrears.  He paid the arrears in 
full.  In November 2007, DFS filed a 
Petition for Modification of Child Support.

 
 
[¶4]      The district 
court held an evidentiary hearing on the Petition.  After the hearing, the district court 
made the following findings:

 
 
3.         
At the time of the trial in this matter, the Respondent, Lauderman, was 
the mother of two (2) minor children, the child at issue who is nine (9) years 
of age, and an infant daughter born in June, 2009.  She was employed at L & H 
Industrial, Inc., as a welder from May, 2007 until her termination in November, 
2007, as a result of her pregnancy.

 
 
4.         
At the time of the trial in this matter, the Respondent, Nomura, was a 
self-employed dry waller operating his own business referred to as RNR Drywall, 
Inc.  Mr. Nomura is the sole officer 
and shareholder of the business. 

 
 
5.         
Respondent Lauderman should be imputed a net income as she is voluntarily 
unemployed.  The Court should impute 
her income from prior years and based on her 2007 W-2.  The fact that she is a stay-at-home 
mother should have no bearing on the imputed income.

 
 
6. 
        
Respondent Lauderman is capable of earning $16.00 per hour and her income 
is based on the following calculations:

 
 
 $33,280.00   Gross income ($16.00 x 2080 hours 
per year)

-$         
0.00    Federal 
income (tax credits are higher than taxes owed)

-$  2,053.00   Social 
Security

-$     483.00   Medicare

 
 
 $30,744.00   annual net income (does not include 
tax credits)

 
 
Divided by 12 months = $2,562.00 net monthly 
income

 
 
7.         
Respondent Nomura's net monthly income is based upon his 2008 actual 
earnings and his earning capability in the future, rather than what he earned 
during more prosperous economic times.

 
 
8.         
To use Respondent Nomura's prior years' income would result in imputing a 
net income that would result in an impossibly high child support obligation and 
would set this party up for failure.  
Therefore, 2008 is the only year that should be used to determine the 
Respondent Nomura's net monthly income.

 
 
9.         
Respondent Nomura's net monthly income is derived from using this net 
revenues from RNR Drywall in the amount of $21,518.05.  This is the amount of actual money that 
was available to Nomura from the business during 2008.  This amount is derived by adding the 
operating income of $5,076.78, plus the income from the sale of an asset (truck) 
in the amount of $16,441.27.

 
 
10.       The health 
insurance of $2,256.38 should be added back in and counted towards the 
Respondent Nomura's net income as his net revenues from the business were 
reduced by this line item and is not for the benefit of the 
child.

 
 
11.       
Depreciation of $107.20 should further be added back to Mr. Nomura's net 
revenues since Wyoming law does not allow depreciation to reduce someone's net 
income.

 
 
12.       Officer 
salary of $17,840.48 should count towards Mr. Nomura's net 
income.

 
 
13.       
Unemployment benefits of $3,490.00 should count towards Mr. Nomura's net 
income.

 
 
14.       The Section 
179, Depreciation of $36,032.95, should not be included in the net monthly 
income of Mr. Nomura.  The Court 
finds that this is not a paper deduction, but rather, is an actual expenditure 
(for a truck) and should be entirely deducted.

 
 
15.       The 2008 
draws of $54,940.34 should not be used for determining the Respondent Nomura's 
income in 2008.  To count the 2008 
draws from the business as income for the Respondent Nomura in 2008 would be 
unfairly inflating his income because it comes from money that was earned in 
prior years.

 
 
16.       The net 
income of the Respondent Nomura is determined as follows:

 
 
$21,518.08    2008 net revenues from RNR 
Drywall

$  
3,490.00    
Unemployment

$  
2,256.38    Health 
Insurance

$     107.20     
Depreciation

$17,840.48    Officer Salary (no 
calculation avail. for personal taxes)

$45,212.14    annual net 
income

 
 
Divided 
by 12 months = $3,767.68 net monthly 
income

 
 
17.       Child 
support is therefore calculated at $650.00 according to the child support 
guidelines in effect at the time of entry of this Order based upon mother's 
imputed net monthly income of $2,562.00; and father's net monthly income of 
$3,767.68.

 
 
In 
sum, Father's child support obligation was reduced from $263.00 per week to 
$650.00 per month.

 
 
DISCUSSION

 
 
Standard 
of Review

 
 
[¶5]      We review a 
district court's order on a petition to modify child support to determine if the 
district court has abused its discretion.  
Gray v. Pavey, 2007 WY 84, ¶ 
8, 158 P.3d 667, 668 (Wyo. 2007).  
Our review entails evaluation of the sufficiency of the evidence to 
support the district court's decision.  
In evaluating the evidence, we afford to the prevailing party every 
favorable inference while omitting any consideration of evidence presented by 
the unsuccessful party.  Triggs v. Triggs, 920 P.2d 653, 657 
(Wyo. 1996), abrograted on other grounds 
by Vaughn v. State, 962 P.2d 149 (Wyo. 1998); Cranston v. Cranston, 879 P.2d 345, 351 
(Wyo. 1994).  Findings of fact not 
supported by the evidence, contrary to the evidence, or against the great weight 
of the evidence cannot be sustained.  
Jones v. Jones, 858 P.2d 289, 
291 (Wyo. 1993).  Similarly, an 
abuse of discretion is present "when a material factor deserving significant 
weight is ignored.'"  Triggs, 920 P.2d  at 657 (quoting Vanasse v. Ramsay, 847 P.2d 993, 996 
(Wyo. 1993)).  See Witowski v. Roosevelt, 2009 WY 5, ¶ 
13, 199 P.3d 1072, 1076 (Wyo. 2009); Bingham v. Bingham, 2007 WY 145, ¶ 10, 
167 P.3d 14, 17-18 (Wyo. 2007); Pahl v. 
Pahl, 2004 WY 40, ¶ 6, 87 P.3d 1250, 1252 (Wyo. 2004).

 
 
Analysis

 
 
[¶6]      We begin by 
noting that Mother's appellate argument is premised on the belief that the 
district court deviated from the presumptive child support amount calculated 
pursuant to Wyo. Stat. Ann. §  
20-3-307.  Mother's argument 
is misplaced.  The district court 
did not deviate from the presumptive child support amount.  What Mother actually takes issue with, 
and what we will discuss, is the district court's computation of income for the 
respective parties.

 
 
[¶7]      Determination of 
child support amounts is governed by statute.  The first step in calculating child 
support is determining the parents' respective monthly net incomes.  "Income" and "net income" are defined in 
Wyo. Stat. Ann. § 20-2-303(a) as:

 
 
(ii) 
"Income" means any form of payment or return in money or in kind to an 
individual, regardless of source.  
Income includes, but is not limited to wages, earnings, salary, 
commission, compensation as an independent contractor, temporary total 
disability, permanent partial disability and permanent total disability worker's 
compensation payments, unemployment compensation, disability, annuity and 
retirement benefits, and any other payments made by any payor, but shall not 
include any earnings derived from overtime work unless the court, after 
considering all overtime earnings derived in the preceding twenty-four (24) 
month period, determines the overtime earnings can reasonably be expected to 
continue on a consistent basis.  In 
determining income, all reasonable unreimbursed legitimate business expenses 
shall be deducted.  Means tested 
sources of income such as Pell grants, aid under the personal opportunities with 
employment responsibilities (POWER) program, food stamps and supplemental 
security income (SSI) shall not be considered as income.  Gross income also means potential income 
of parents who are voluntarily unemployed or 
underemployed;

 
 
(iii) 
"Net income" means income as defined in paragraph (ii) of this subsection less 
personal income taxes, social security deductions, cost of dependent health care 
coverage for all dependent children, actual payments being made under 
preexisting support orders for current support of other children, other 
court-ordered support obligations currently being paid and mandatory pension 
deductions.  Payments towards child 
support arrearage shall not be deducted to arrive at net 
income[.]

 
 
Wyo. 
Stat. Ann. § 20-2-303(a)(ii) and (iii) (LexisNexis 2009).  

 
 
Mother's 
Income

 
 
[¶8]      Mother first 
objects to the district court's finding that she was voluntarily 
unemployed.  The evidence supports 
this finding.  Mother had worked as 
a welder in 2007.  After she was let 
go from that job, she decided to be a stay-at-home mother.  Mother testified that there were welding 
jobs currently available in her town, which she was physically capable of 
performing.  She wasn't applying for 
them because she didn't want to be away from her children.  Given this testimony, it was well within 
the district court's discretion to find Mother voluntarily unemployed.  See, e.g., In re Paternity of IC, 971 P.2d 603, 607 (Wyo. 1999) (voluntarily leaving job to return to school 
constitutes voluntary unemployment).

 
 
[¶9]      Mother next 
objects to the amount of income imputed to her.  In 2007, when she was working as a 
welder, she was earning $16.00 per hour.  
Mother testified that jobs were available at the time of the hearing and 
were paying $16.00 per hour.  
Mother's own evidence supports the district court's decision to impute to 
her a salary of $16.00 per hour.   

 
 
[¶10]   Mother's objection continues that 
the district court abused its discretion when it did not subtract any amount for 
federal income tax.  The district 
court's calculations show that it considered federal income tax.  It determined the tax credits available 
to Mother exceeded the amount of federal income tax owed based on the imputed 
salary.  In making this 
determination, the district court adopted figures provided by the DFS indicating 
the amount of earned income credit and child tax credit would be more than the 
federal income tax due.  The 
district court's reliance on the DFS calculation is reasonable under the 
circumstances.

 
 
Father's 
Income

 
 
[¶11]   Turning to Father's income, Mother 
contends Father should be found to be voluntarily underemployed.  The evidence shows that Father worked as 
a drywaller for 18 years.  He owned 
and operated a drywall business in the Jackson area.  When business declined in the Jackson 
area Father relocated to Worland.  
Despite his attempts to keep the business going, Father testified there 
was simply no work available: "I've hit every job there is.  I've stopped on every job site there 
is.  I've spoke [sic] with every 
contractor there is in Jackson, Worland, Thermop [sic], surrounding areas.  I have contacts nationwide, and 
everybody's out of work right now."  
Father even looked for jobs in the oil field sector but was unable to 
find anything.  Given the evidence, 
we find no credence in Mother's contentions that Father isn't looking hard 
enough or in a wide enough geographic scope.

 
 
[¶12]   Mother next takes issue with the 
district court's computation of Father's income.  First, she argues the district court 
should have included in-kind benefits Father received from his business as 
income.  Mother does not, however, 
identify any in-kind benefits received by Father.  We therefore need not consider this 
argument further.  

 
 
[¶13]   Mother also argues the district 
court erred in not including certain draws Father took from his business in 2008 
as income.  Father's accountant, 
however, explained that draws are unrelated to business income.  Draws come from money already in the 
business that could have been earned at any time during the business's 
existence.  At the time of the 
hearing, the business had only approximately $9,000.00.  Father's future income, therefore, would 
be limited to amounts earned during the current year.  Under the circumstances, the district 
court did not abuse its discretion in not factoring the draws into Father's 
income for child support purposes.

 
 
[¶14]   Finally, Mother argues the district 
court abused its discretion in using Father's 2008 income instead of his 2007 
income.  The district court 
explained its decision in its order.  
It did not use Father's 2007 income because it did not accurately reflect 
current economic conditions.  The 
district court determined Father was not likely to be able to earn the same 
amount in the future.  Given the 
well-documented collapse of the construction industry, as well as Father's 
testimony as to how the economic downturn is affecting him personally, we find 
the district court was within its discretion in relying on Father's 2008 actual 
income as more appropriately indicative of Father's future earning 
capacity.

 
 
[¶15]   In Woodward v. Woodward, 428 P.2d 389 (Wyo. 
1967), a case wherein a father's earning capacity had deteriorated, this Court 
stated

 
 
the 
trial court has found that, due to no fault or choice of his own, the father of 
the children does not now have an earning capacity or income sufficient to 
enable him to pay more than the amount required by the court's 
decree.

 
 
* 
* * *

 
 
. 
. . [S]hould the future earning capacity and ability of the father be bettered, 
either by improvement in his health or through his securing of more remunerative 
employment or additional estate, the door remains open to show such changed 
condition, and modification of the court decree may be 
had.

 
 
The 
law never intends to require the impossible, and an award without ability to pay 
would have been a fruitless gesture which could not inure to the benefit of the 
minor children whose welfare is of primary concern to 
courts.

 
 

Id. 
at 
390.  The same comments apply 
here.

 
 
Introduction 
of Letters

 
 
[¶16]   During the hearing, to support his 
testimony that he had been actively looking for work, Father offered multiple 
letters from contractors stating they had no work available for him.  The district court admitted the letters 
into evidence over Mother's several objections including a hearsay 
objection.   The decision of 
whether or not to admit evidence lies within the discretion of the trial 
court.  Three Way, Inc. v. Burton Enters., Inc., 
2008 WY 18, ¶ 29, 177 P.3d 219, 228 (Wyo. 2008).  We will not disturb the trial court's 
ruling absent abuse of that discretion.  
McCabe v. R.A. Manning Constr. 
Co., Inc., 674 P.2d 699, 706 (Wyo. 1983).  As always, even if this Court determines 
that the trial court erred in ruling on the admissibility of evidence, we 
disregard errors which are harmless.  
W.R.C.P. 61; W.R.A.P. 9.04; W.R.E. 103.

 
 
[¶17]   We need not discuss whether the 
admission of the letters constituted error because, even if it did, Mother was 
not prejudiced by such introduction.  
The district court listened to Mother's objections and admitted the 
letters over the objections stating "[t]he Court can give them the weight that 
it determines, so I don't think that it's going to be prejudicial."  There is no further indication that the 
district court relied on the letters, nor was it necessary for the district 
court to do so.  Father testified 
extensively as to his continuing job search.  The letters do nothing more than 
corroborate that testimony.  See Rudy v. Bossard, 997 P.2d 480, 484 (Wyo. 
2000) (no prejudice in admission of letter when letter did nothing more than 
corroborate testimony).

 
 
CONCLUSION

 
 
[¶18]   We find no abuse of discretion in 
the district court's calculation of the parties' respective incomes for child 
support purposes.  The decision is 
reasonable under the circumstances.  
We also find no harm in the introduction of letters corroborating 
Father's extensive testimony on his attempts to find work.  Affirmed.

 
 

HILL, 
Justice, 
dissenting.

 
 
[¶19]   I respectfully dissent because my 
review of this case convinces me that the proceedings that are included in the 
record on appeal are insufficient to disturb the status quo.  In 2004, a New Jersey court set Father's 
child support obligation at $263.00 per week.  That judgment was registered in Wyoming 
in 2005 and under its terms, Father has been required to pay that much in child 
support to Mother since that time (although he has not always done so).  The child at issue in this appeal is 
nearing 11 years of age as we address the difficulties that this case 
poses.

 
 
[¶20]   In Wyoming it is traditional to set 
child support as a monthly figure and so I would calculate that figure like 
this: $263.00 x 52 weeks = $13,676.00 per year · 12 months = $1,139.6666 rounded 
to $1,139.67 per month.  In her 
brief, Mother contends/concedes that Father should pay $1,109.88, if the "facts 
and figures" that can be gleaned from the record on appeal are deemed to be 
accurate enough to provide the basis for a reliable decision in that 
regard.  Mother concedes she can do 
some work and earn approximately $1,269.73 per month.

 
 
[¶21]   During the months May through 
November in 2007, just before the birth of her youngest child, Mother earned 
$16.00 an hour as a welder, although she only worked for seven months during 
that year (she was discharged late in her pregnancy).  So, in addition to the child she shares 
with Father, Mother now has the care of an infant child born of a recent 
relationship.  Mother's contention 
is that, while she is capable of doing some work, she cannot go back to welding 
full-time.  This is so because she 
cannot arrange adequate child care for her infant child because the work shifts 
for welders are 12-hour shifts.  In 
addition, she must, of course, provide parenting for the older child who is the 
beneficiary of Father's child support.

 
 
[¶22]   The district court determined that 
Mother was capable of working 40 hours a week, 52 weeks a year, at a pay rate of 
$16.00 an hour ($33,280.00 annually).  
Although Father has historically earned significantly more than he did in 
2008, the district court determined that Father's income for 2008 was $3,767.68 
per month.  The year 2008 was chosen 
because that was the year "hard-times" hit in the construction industry (Father 
owns a dry-wall company).  Based on 
that calculation, Father was to pay Mother $650.00 per month in child 
support.  The district court's 
equation is just not an acceptable means of calculating child support.  The evidence suggested that Father was 
capable of earning significantly more than the amount attributed to him (and 
very likely was earning more).  The 
testimony suggested that Father used his construction company to pay many of his 
living expenses, including transportation and housing.  Although the Internal Revenue Service 
allows such "deductions" and "adjustments" for income tax purposes, this Court 
should not permit adequate child support to hinge upon how talented a parent's 
accountant (and the taxpayer himself) is at the art of income tax 
avoidance.  See Durham v. Durham, 2003 WY 95, 
¶¶ 8-12, 74 P.3d 1230, 1233-34 (Wyo. 2003); Bailey v. Bailey, 954 P.2d 962, 967 
(Wyo. 1998); 3 Anteau, et al., Family Law 
Litigation Guide with Forms:  
Discovery, Evidence, Trial of Child Support Issues § 34.04[b] 
(Imputed Income) (2008).

 
 
[¶23]   We have held that the district 
court's discretion with respect to child support is limited by Wyoming's 
statutes that govern that subject.  
Wyo. Stat. Ann. §§ 20-2-301 through 20-2-315 (LexisNexis 2009); Steele v. Steele, 2005 WY 33, ¶ 12, 
108 P.3d 844, 849 (Wyo. 2005).

 
 
Judicial 
discretion is a composite of many things, among which are conclusions drawn from 
objective criteria; it means a sound judgment exercised with regard to what is 
right under the circumstances and without doing so arbitrarily or 
capriciously.

 
 

Vaughn 
v. State, 
962 P.2d 149, 151 (Wyo. 1998).  
Under the facts and circumstances presented here, the district court 
decision is not "right."  It applies 
two widely divergent formulas in calculating the parties' incomes and produces a 
result that is an affront to both the letter and the spirit of the statutes 
governing child support.

 
 
[¶24]   For these reasons I would remand 
this matter to the district court with directions that the "Order on Petition 
for Modification of Support" state a conclusion that Father's obligation to pay 
child support must remain unchanged.