COURT OF APPEALS OF VIRGINIA 

Present: Judges Benton, Coleman and Fitzpatrick 

Argued at Richmond, Virginia 

LINDA S. FRAZER 

 OPINION BY 

v. Record Nos. 1699-95-2 and JUDGE JOHANNA L. FITZPATRICK 

 1975-95-2 OCTOBER 29, 1996 

 

JAMES DOUGLAS FRAZER 

FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY 

William R. Shelton, Judge 

 Gail H. Miller; John Randolph Smith (Smith & 

Miller, P.C., on briefs), for appellant. 

 Murray J. Janus (Deanna D. Cook; Bremner & 

Janus, on brief), for appellee. 

 Linda S. Frazer (wife) appeals the trial court's decisions 

on equitable distribution, spousal support, and child support. 

She argues, inter alia, that the trial court erred in: (1) 

valuing the business of James Douglas Frazer (husband); (2) 

dividing the parties' Merrill Lynch accounts; (3) crediting 

husband with his separate property; (4) dividing the parties' 

Harmony Hills property; (5) ordering each party to pay fifty 

percent of extraordinary medical expenses for their son; (6) 

failing to award wife additional pendente lite spousal support 

and awarding permanent spousal support beginning one month after 

entry of the final decree; (7) determining husband's gross income 

for spousal support purposes; (8) calculating spousal support; 

(9) modifying the child support award after wife had appealed the 

final decree to this Court; (10) including wife's spousal support 
 2 

in her income for child support purposes; (11) the distribution 

to husband of his First Penn life insurance policy valued at 

$12,000; (12) the division of the cash value of a life insurance 

policy owned by husband; and (13) the exclusion of the $870 life 

insurance premium from the marital estate. For the following 

reasons, we remand to the trial court for further proceedings in 

accordance with this opinion. 

 BACKGROUND

 The parties were married on December 16, 1978. After their 

marriage, husband adopted wife's daughter from her first 

marriage, and their son Ben was born on February 5, 1980. The 

parties separated when husband left the marital residence on 

October 7, 1992. 

 Husband filed a bill of complaint for divorce on December 

31, 1992. A pendente lite hearing was held January 20, 1994, and 

the trial court awarded wife custody of the parties' son, $1,704 

per month in child support, and $1,000 in spousal support for 

three months. Evidence on equitable distribution and support 

issues was taken by deposition, and each party submitted exhibits 

to the trial court. 

 The evidence established that, when the parties married in 

1978, husband worked for Litton Industries. In 1984, husband 

left Litton, and the parties started Frazer Sales & Associates, 

Inc., with husband as the sole shareholder. Husband's monetary 

contributions to the marriage were far greater than wife's. His 
 3 

monthly salary was approximately $18,000. Husband's nonmonetary 

contributions included coaching Ben's soccer team, cleaning the 

house, and maintaining the yard. Wife's nonmonetary 

contributions to the marriage included maintaining the home, 

cooking, caring for the children, and doing the family's laundry 

and shopping. She also was involved in community activities, 

helped husband with his business, and entertained his clients. 

The standard of living established during the marriage was high. 

 The parties lived in a large home and owned luxury vehicles, a 

sport fishing boat, and a condominium in Hampton, Virginia. 

 The trial court issued its first letter opinion on October 

6, 1994, and a subsequent letter opinion on October 28, 1994, 

both resolving issues of equitable distribution and child 

support. The court held a hearing on February 2, 1995 to 

consider the parties' requests for division of the marital 

assets. The final letter opinion dated March 3, 1995 resolved 

the issues of equitable distribution, spousal support, and child 

support. A final decree of divorce was entered July 7, 1995, and 

incorporated the letter opinions of October 28, 1994 and March 3, 

1995. 

 Wife appealed the final decree to this Court on August 1, 

1995. On August 3, 1995, the trial court reduced husband's child 

support obligation to comply with the new legislative guidelines 

enacted July 1, 1995. On August 30, 1995, wife noted her appeal 

of the August 3, 1995 order. By order of this Court dated 
 4 

September 19, 1995, the two appeals were consolidated for 

briefing and argument. 
 5 

 VALUATION OF HUSBAND'S BUSINESS

 Husband is the sole stockholder of Frazer Sales & 

Associates, Inc., a manufacturer's representative business. 

Wife's expert, who was qualified in valuing similar businesses, 

valued husband's business at $423,500 and prepared a detailed 

written report. In evaluating the business, wife's expert relied 

upon the business' tax returns and information obtained from wife 

about the history of the business until she left the business in 

1991. He also considered the customers and the general operation 

of the business. Wife's expert had no contact with husband, his 

employees, or customers in gathering information about the 

business. 

 Husband's expert, the accountant for the business, reviewed 

corporate books and records and had prepared the business' 1993 

tax return. In determining the value of the business, he 

examined its capital assets and current income and expenses. 

Husband's expert valued the assets of the business at $75,000 and 

opined that the business had "perhaps as much as $150,000.00 in 

value." Husband's expert emphasized the personal nature of 

husband's relationships with his clients and the importance of 

husband's participation to the business' continued success. 

Additionally, husband testified that he had worked twenty-six 

years in developing his relationships with his two customers and 

that the business would have no value if he was not part of the 

company. The trial court accepted husband's evidence and valued 
 6 

the business at $150,000. 

 Wife argues that the trial court erred in accepting 

husband's expert's value of Frazer Sales and in rejecting wife's 

expert's detailed analysis. 

 "Conflicting expert opinions constitute a question of fact 

. . . ." McCaskey v. Patrick Henry Hosp., 225 Va. 413, 415, 304 

S.E.2d 1, 5 (1983). The trial court's "province alone, as the 

finder of fact, [is] to assess the credibility of the witnesses 

and the probative value to be given their testimony." Richardson 

v. Richardson, 242 Va. 242, 246, 409 S.E.2d 148, 151 (1991). In 

determining the value of marital property, "'the finder of fact 

is not required to accept as conclusive the opinion of [any] 

expert.'" Stratton v. Stratton, 16 Va. App. 878, 883, 433 S.E.2d 

920, 923 (1993) (quoting Lassen v. Lassen, 8 Va. App. 502, 507, 

383 S.E.2d 471, 474 (1989)). Additionally, the trial court, as 

fact finder, "'has a right to weigh the testimony of all the 

witnesses, experts and otherwise.'" Bell Atlantic Network Servs. 

v. Virginia Employment Comm'n, 16 Va. App. 741, 746, 433 S.E.2d 

30, 33 (1993) (emphasis added) (quoting Pepsi-Cola Bottling Co. 

v. McCullers, 189 Va. 89, 99, 52 S.E.2d 257, 261 (1949)). 

 In the instant case, the trial court accepted the valuation 

of husband's expert after weighing the valuations presented by 

both experts and the basis for each expert's opinion. Husband's 

expert was clearly familiar with the daily workings of the 

business and its records and assets, and based his opinion in 
 7 

part on the importance of husband's personal contributions to the 

success of the business. Although wife's expert had valued 

similar businesses and prepared a detailed analysis of the 

business' value, he relied primarily on outside information 

obtained from wife. The trial court was not required to accept 

his valuation and could "weigh the testimony of all the . . . 

experts." Bell Atlantic, 16 Va. App. at 746, 433 S.E.2d at 33. 

Under these circumstances, the trial court was not plainly wrong 

in accepting the valuation of husband's expert rather than that 

of wife's. 

MERRILL LYNCH ACCOUNTS

 In wife's Exhibit 1 submitted May 3, 1994, she listed three 

Merrill Lynch accounts totaling $132,827 as marital assets: (1) 

a $69,168 account in the name of husband's business; (2) a 

$10,360 account in husband's name; and (3) a $53,299 account in 

wife's name. Husband testified in his deposition on April 27, 

1994 that he had two accounts with Merrill Lynch, one personal 

and one corporate, and that the parties shared a joint bond 

account. However, in husband's Exhibit 4 submitted May 24, 1994 

and during his deposition taken that day, he indicated a single 

Merrill Lynch account in wife's possession with a value of 

$132,827. In the trial court's first letter opinion dated 

October 6, 1994, the court classified all of the accounts as 

marital property and valued them at $132,827. 

 On October 18, 1994, wife filed a motion to reconsider, 
 8 

arguing that husband omitted certain investments from his 

exhibit. She submitted an account statement that showed an 

additional value in husband's personal Merrill Lynch account of 

$33,180, dated November 27, 1992, two years before either husband 

or wife submitted exhibits to the court. At the October 20, 1994 

hearing, the trial court refused to hear additional evidence 

regarding the accounts and ruled that "there must be a limit on 

the time in which evidence can be submitted." In its final 

letter opinion of March 3, 1995, the trial court assigned the 

value of the accounts--$101,101 to wife and $31,726 to husband. 

In the final decree entered July 7, 1995, the court ordered the 

parties to "sign whatever papers are necessary to effectuate the 

transfers of vehicles, partnerships and other property," and 

ordered wife to pay husband a monetary award of $31,726. 

 Wife contends that the trial court erred in refusing to 

allow her to present additional evidence of the value of the 

Merrill Lynch accounts after the evidence was concluded because 

husband misrepresented the value of his personal Merrill Lynch 

account by omitting certain investments. A trial court "may not 

refuse or fail to give parties a reasonable opportunity to 

develop and present evidence of value." Mosley v. Mosley, 19 Va. 

App. 192, 195, 450 S.E.2d 161, 163 (1994). Although the trial 

court gave wife ample opportunity to present evidence of the 

value of the Merrill Lynch accounts, the record fails to show 

when the report dated November 27, 1992, became known to or was 
 9 

available to the wife. The record shows that although husband 

made no misrepresentations regarding the value of his personal 

Merrill Lynch account, he did fail to disclose the existence or 

value of a personal account of $33,180, dated November 27, 1992. 

 Because the classification and evaluation of the Merrill Lynch 

accounts must be reviewed on remand, no rationale exists for 

excluding the additional account from equitable distribution. 

 Wife also argues that the trial court erred in failing to 

determine the actual ownership of each account. Code 

§ 20-107.3(A) provides, in pertinent part, as follows: 

 Upon decreeing the dissolution of a 

marriage, and also upon decreeing a divorce 

from the bond of matrimony, or upon the 

filing with the court as provided in 

subsection J of a certified copy of a final 

divorce decree obtained without the 

Commonwealth, the court, upon request of 

either party, shall determine the legal title 

as between the parties, and the ownership and 

value of all property, real or personal, 

tangible or intangible, of the parties and 

shall consider which of such property is 

separate property, which is marital property, 

and which is part separate and part marital 

property in accordance with subdivision A 3. 

(Emphasis added). "Code § 20-107.3 details the steps which a 

trial court must follow in determining the equitable distribution 

of property. The court must first determine the legal title as 

between the parties and the ownership and value of all property. 

 The court must also determine whether the property is marital or 

separate property." Robinette v. Robinette, 4 Va. App. 123, 128, 

354 S.E.2d 808, 810 (1987) (emphasis added). In dividing the 
 10 

property of divorcing parties, "the court shall have no authority 

to order the division or transfer of separate or marital property 

which is not jointly owned." Code § 20-107.3(C) (emphasis 

added). 

 In the instant case, the record fails to show that the trial 

court followed the steps required by Code § 20-107.3(A) in 

dividing the Merrill Lynch accounts. Although the trial judge 

properly classified the accounts as marital property and 

determined the total amount in the accounts to be $132,827, the 

court failed to make specific findings about how many accounts 

existed, what each account was worth, and who owned which 

accounts. Wife's exhibit indicated three separate accounts 

totaling $132,827, one titled in her name, one in husband's name, 

and one in the name of the business. Husband indicated that he 

had two accounts with Merrill Lynch, one titled in his name and 

one in the name of the business. However, husband also testified 

that wife was in possession of one Merrill Lynch account with a 

value of $132,827. Thus, because the evidence is in conflict 

about who owned which accounts and the trial court failed to make 

any specific findings regarding ownership of the accounts, on 

remand, the trial court must reexamine these accounts, determine 

the ownership of the accounts, and then divide the account assets 

in accordance with Code § 20-107.3. 

HUSBAND'S SEPARATE PROPERTY

 Before the parties married in 1978, husband worked for 
 11 

Litton Industries and had a retirement plan with that company. 

After the parties married, husband continued working for Litton 

for six years until 1984. When husband left Litton, he rolled 

over his $40,000 Litton retirement plan, a portion of which had 

accrued prior to the marriage, into his pension with Frazer 

Sales. Husband testified that he had "no idea" what the value of 

the Litton retirement plan was at the time of his marriage to 

wife. Husband estimated the current value of the Litton 

retirement plan to be $72,000. The trial court awarded the 

$72,000 retirement plan to husband as his separate property. 

 Wife argues that the trial court erred in awarding the 

entire Litton retirement plan to husband as his separate property 

when undisputed evidence clearly established that a portion of 

the plan was marital and a portion was separate. 

 Code § 20-107.3(A)(2) provides as follows: 

 All property including that portion of 

pensions, profit-sharing or deferred 

compensation or retirement plans of whatever 

nature, acquired by either spouse during the 

marriage, and before the last separation of 

the parties, if at such time or thereafter at 

least one of the parties intends that the 

separation be permanent, is presumed to be 

marital property in the absence of 

satisfactory evidence that it is separate 

property. 

(Emphasis added). "Separate property" includes "all property, 

real and personal, acquired by either party before the marriage." 

 Code § 20-107.3(A)(1)(i). Pursuant to Code § 20-107.3(A)(3), a 

trial court must classify the parties' property as part marital 
 12 

 

and part separate in certain circumstances. "In the case of any 

pension, profit-sharing, or deferred compensation plan or 

retirement benefit, the marital share as defined in subsection G 

shall be marital property." Code § 20-107.3(A)(3)(b).1

 

 The evidence established that husband's employment with 

Litton began before the marriage and that husband continued 

working for Litton for six years after the parties married. 

Under Code § 20-107.3(A)(1), the portion of the Litton retirement 

plan attributable to husband's efforts before the parties married 

is presumed to be his separate property. The portion of the 

Litton retirement plan earned during the marriage is presumed 

marital unless husband produces satisfactory evidence that it is 

separate. Code § 20-107.3(A)(2), (G). Husband estimated that 

the 1984 value of the Litton retirement plan was $40,000 and that 

the current value of the plan is $72,000. However, husband 

failed to show which portion was earned before the marriage 

(separate) and which portion was earned during the marriage 

(marital). Thus, the trial court erred in awarding husband the 

entire $72,000 Litton retirement plan as his separate property. 

On remand the trial court must: (1) determine the value of the 

marital and separate shares of these retirement benefits; (2) 

determine the rights and equities of the parties in the marital 

 1Code § 20-107.3(G) defines "marital share" as "that portion of 

the total interest, the right to which was earned during the 

marriage and before the last separation of the parties, if at such 

time or thereafter at least one of the parties intended that the 

separation be permanent." 
 13 

share; and (3) if an award is to be made, to award a percentage 

of benefits which comports with the requirements of Code 

§ 20-107.3 (G). 

HARMONY HILLS PROPERTY

 The parties owned a jointly-titled property in Harmony Hills 

in Richmond, Virginia valued at $135,000. Neither party wanted 

the property, and the court ordered the property sold and the 

proceeds divided $109,500 (eighty-one percent) to wife and 

$25,500 (nineteen percent) to husband. In the final decree, the 

court ordered that any proceeds from the sale of the property 

exceeding $135,000 be divided in the same percentage. 

 Wife argues that the trial court erred in dividing the 

proceeds from the sale of the Harmony Hills property in a manner 

inconsistent with the joint ownership of the parties, i.e., 

failing to divide the sale proceeds fifty-fifty. Although the 

trial court awarded wife the greater portion of the sale 

proceeds, she contends that this award will subject her to 

greater capital gains tax liability than husband, and that the 

court erred in failing to consider the tax consequences of its 

unequal division of the sale proceeds. 

 Code § 20-107.3(C) provides as follows: 

 The court may, based upon the factors listed 

in subsection E, divide or transfer or order 

the division or transfer, or both, of jointly 

owned marital property, or any part thereof. 

 As a means of dividing or transferring 

the jointly owned marital property, the court 

may transfer or order the transfer of real or 

personal property or any interest therein to 
 14 

one of the parties, permit either party to 

purchase the interest of the other and direct 

the allocation of the proceeds, provided the 

party purchasing the interest of the other 

agrees to assume any indebtedness secured by 

the property, or order its sale by private 

sale by the parties, through such agent as 

the court shall direct, or by public sale as 

the court shall direct without the necessity 

for partition. 

The trial court had authority to order the sale of the parties' 

Harmony Hills property pursuant to Code § 20-107.3(C). 

Additionally, because Code § 20-107.3(C) does not require that 

the trial court equally divide the proceeds from the sale of 

jointly owned property, the trial court did not err in dividing 

the proceeds of the sale eighty-one percent to wife and nineteen 

percent to husband. 

 In dividing jointly owned marital property, the trial court 

must consider the specified factors in Code § 20-107.3(E), 

including "[t]he tax consequences to each party." Code 

§ 20-107.3(E)(9). Wife's argument that she will be subject to 

greater tax liability because of the unequal division of the sale 

proceeds is of no consequence. The wife received a substantially 

greater portion of the sale proceeds than did the husband and the 

court necessarily considered that each would bear his and her 

proportionate share of capital gains taxes. Thus, the trial 

court did not err in apportioning the sale proceeds eighty-one 

percent to wife and nineteen percent to husband. 

EXTRAORDINARY MEDICAL EXPENSES

 At the hearing on February 2, 1995, wife asked the court to 
 15 

order husband to pay his "share of the extraordinary health care 

costs of our son, including those for orthodontic treatment and 

prescriptions for ritilin (on[-]going expense)." In the final 

opinion letter dated March 3, 1995, the trial court ordered 

husband to maintain the orthodontic care of the parties' son and 

the parties to "divide equally the extraordinary medical expenses 

not covered by insurance." The record does not indicate the 

amount of extraordinary medical expenses incurred by the parties' 

son, specifically, the amount paid for his on-going ritilin 

prescription. 

 Wife asserts that the trial court erred in ordering the 

parties to divide equally the extraordinary medical expenses not 

covered by insurance because these expenses should have been 

divided according to the child support obligation of each party. 

 Code § 20-108.2(D) provides as follows: 

 Any extraordinary medical and dental 

expenses for treatment of the child or 

children shall be added to the basic child 

support obligation. For purposes of this 

section, extraordinary medical and dental 

expenses are uninsured expenses in excess of 

$100 for a single illness or condition and 

shall include but not be limited to 

eyeglasses, prescription medication, 

prostheses, and mental health services 

whether provided by a social worker, 

psychologist, psychiatrist, or counselor. 

(Emphasis added). "A primary rule of statutory construction is 

that courts must look first to the language of the statute. If a 

statute is clear and unambiguous, a court will give the statute 

its plain meaning." Loudoun County Dep't of Social Servs. v. 
 16 

Etzold, 245 Va. 80, 85, 425 S.E.2d 800, 802 (1993). 

 This Court has held that Code § 20-108.2(D) contemplates 

"payment for past expenses as well as continuing expenses." 

Carter v. Thornhill, 19 Va. App. 501, 507, 453 S.E.2d 295, 300 

(1995). In Carter, the mother incurred substantial medical 

expenses for the treatment of the parties' daughter, who was in a 

serious car accident. The father filed a petition to modify 

child support, and the mother responded that the guideline amount 

was inadequate to cover the daughter's medical expenses. Id. at 

503-04, 453 S.E.2d at 297-98. The trial court determined the 

parties' child support obligations under the guidelines, deviated 

from the guidelines because of the extraordinary medical 

expenses, and ordered the father to pay his percentage of the 

accrued medical expenses to the mother in a lump sum. Id. at 

504-06, 453 S.E.2d at 298-99. This Court determined that "the 

trial court's order was not a retroactive modification but a 

prospective award." Id. at 505, 453 S.E.2d at 298. 

 Although not specifically on point, our decision in Carter

upheld the division of extraordinary medical expenses according 

to "the percentages owed by each party toward [the] daughter's 

support." Id. at 506, 453 S.E.2d at 299. The plain meaning of 

Code § 20-108.2(D) contemplates a division of extraordinary 

medical expenses as part of "the basic child support obligation." 

 While the record in this case established that the parties' 

son suffered from a condition requiring an on-going prescription 
 17 

for ritilin, no evidence indicated the exact nature of his 

condition or whether the prescription expenses were over $100. 

Thus, insufficient evidence supports the trial court's award of 

extraordinary medical expenses. Additionally, considering the 

plain meaning of Code § 20-108.2(D), we hold that the trial court 

erred in dividing equally the extraordinary medical expenses not 

covered by insurance rather than by a percentage equal to each 

party's child support obligation. On remand, the trial court 

should calculate each party's responsibility for any specific, 

extraordinary medical expenses established by the evidence, 

dividing these expenses in accordance with "the basic child 

support obligation" of each party.2

 SPOUSAL SUPPORT 

 (1) Pendente Lite Spousal Support and 

Timing of Permanent Spousal Support

 After a hearing on January 20, 1994, the trial court awarded 

 

 2Other states also provide for the inclusion of extraordinary 

medical expenses in the basic child support obligation. See, 

e.g., In re Marriage of Pollock, 881 P.2d 470, 472 (Colo. Ct. App. 

1994) ("[E]xtraordinary medical expenses incurred on behalf of the 

children are to be added to the basic child support obligation and 

divided between the parents in proportion to their adjusted gross 

incomes."); Lloyd v. Lloyd, 649 So. 2d 32, 36 (La. Ct. App. 1994) 

("By agreement of the parties or by order of the court, 

extraordinary expenses incurred on behalf of the child shall be 

added to the basic child support obligation.") (quoting La. Rev. 

Stat. § 9:315.5); Petrini v. Petrini, 648 A.2d 1016, 1019 n.8 (Md. 

1994) (recognizing that extraordinary medical expenses may be 

added to the basic child support obligation and holding that the 

basic child support obligation is "divided proportionately between 

the parents in relation to their 'adjusted actual incomes'"); In 

re Marriage of Weed, 836 P.2d 591, 594 (Mont. 1992) (holding that 

extraordinary medical expenses "should be prorated between the 

parents and added to supplement the child support obligation"). 
 18 

wife pendente lite spousal support of $1,000 per month for three 

months, commencing February 1, 1994. The trial court gave no 

reason for limiting wife's pendente lite support to three months. 

 Husband continued to pay wife spousal support until October 

1994. On February 2, 1995, wife requested an award of spousal 

support retroactive to October 6, 1994. The trial court issued 

its final letter opinion on March 3, 1995, awarding wife 

permanent spousal support commencing one month from the date of 

the final decree. The final decree was not entered until July 7, 

1995. From October 1994 to August 1995, wife received no spousal 

support. 

 Wife argues that the trial court erred in refusing to extend 

her pendente lite spousal support beyond the original three-month 

period and in ordering permanent spousal support to commence one 

month after entry of the final decree. 

 We recognize that the decision "[w]hether to grant pendente

lite support lies within the sound discretion of the trial 

judge." Weizenbaum v. Weizenbaum, 12 Va. App. 899, 905, 407 

S.E.2d 37, 40 (1991). Although a trial court may in its 

discretion limit the duration of a pendente lite support award to 

the period of time reasonably necessary for the parties to 

conclude their litigation, nevertheless, in this case, the trial 

judge after finding a need for support gave no reason for 

limiting wife's pendente lite support to three months. If 

husband had stopped paying pendente lite spousal support after 
 19 

the three-month period ended in April 1994, wife would have been 

without any spousal support for over one year. Because wife 

showed a need for spousal support, and the record reflects no 

rationale for the time limitation imposed, we hold that the trial 

court abused its discretion in limiting her pendente lite spousal 

support to three months. 

 Additionally, "the trial court [has] discretion to enter the 

award of spousal support effective any time after the date of the 

commencement of the suit." Konefal v. Konefal, 18 Va. App. 612, 

614, 446 S.E.2d 153, 154 (1994). Under the circumstances in this 

case, the trial court abused its discretion in ordering permanent 

spousal support to begin one month from entry of the final 

decree. The trial court found that wife had established a need 

for permanent spousal support at the March 1995 hearing. 

However, its timing of the award of permanent spousal support 

combined with the earlier discontinuance of pendente lite support 

left her without any support for approximately ten months. 

 (2) Husband's Voluntary Contributions to a Retirement Account

and Amount of Permanent Spousal Support

 Husband submitted evidence that showed his income to be 

$18,167 per month. His evidence included a W-2 form, showing a 

monthly salary of $17,895, and Exhibit 11, which indicated that 

he drew $10,000 per month in salary and averaged $8,167 per month 

in commissions. Wife's expert determined husband's average 

monthly income to be $22,330 by using a six-year weighted 

average, and his monthly income for 1993 to be $27,084. 
 20 

 Husband admitted that he voluntarily contributed $30,000 

from his gross income to his retirement plan in 1993. Husband's 

accountant confirmed that husband added $30,000 to his retirement 

account in 1993 and that, if husband had not put the money into 

his retirement plan, he could have taken "it as additional 

compensation in the form of a bonus, or additional salary." The 

trial court excluded the voluntary retirement contributions from 

the calculation of husband's gross income and determined 

husband's monthly income to be $18,167. Wife's monthly income 

was established as $2,260. Wife's evidence indicated that her 

monthly expenses were over $11,000, and included monitoring of 

her ongoing health problems. Husband's evidence established that 

his monthly expenses were $8,651, and included over $1,000 per 

month to maintain his boat. In the March 3, 1995 letter opinion, 

the court set permanent spousal support at $416 per month. 

 Wife argues that the trial court erred in failing to include 

husband's voluntary contributions to his retirement plan in his 

gross income for the purposes of determining spousal support. 

 Code § 20-107.1 provides that, in determining spousal 

support, the trial court shall consider "[t]he earning capacity, 

obligations, needs and financial resources of the parties, 

including but not limited to income from all pension, profit 

sharing or retirement plans, of whatever nature." Code 

§ 20-107.1(1) (emphasis added). No Virginia case has addressed 

the issue of whether voluntary contributions to a retirement plan 
 21 

should be included in a spouse's income when determining spousal 

support. However, other jurisdictions who have addressed this 

issue include a spouse's voluntary contributions to a retirement 

account, pension plan, or savings account in gross income in a 

child support context. See, e.g., Nelson v. Nelson, 651 So. 2d 

1252, 1253-54 (Fla. Dist. Ct. App. 1995) (no deduction from gross 

income allowed for party's voluntary contributions to retirement 

account); State ex rel. Nielsen v. Nielsen, 521 N.W.2d 735, 737 

(Iowa 1994) ("Our guidelines specifically do not allow a 

deduction for voluntary savings or payment of indebtedness."); 

Lebrato v. Lebrato, 529 N.W.2d 90, 98-99 (Neb. Ct. App. 1995) 

("The Guidelines do not allow a deduction for contributions to 

voluntary retirement plans in arriving at net income . . . ."); 

Shaver v. Kopp, 545 N.W.2d 170, 175 (N.D. 1996) (gross income is 

income from any source and includes an employee's voluntary 

contributions to tax-deferred savings and his employer's matching 

contributions); Heisey v. Heisey, 633 A.2d 211, 212 (Pa. Super. 

Ct. 1993) (only non-voluntary retirement payments may be 

subtracted from gross income). 

 We find no reason to calculate gross income for the 

determination of spousal support in a manner different from the 

calculation of gross income in the child support context when 

addressing a voluntary contribution to a savings or deferred 

compensation plan. For purposes of determining child support 

Code § 20-108.2(C) defines gross income as follows: 

 For purposes of this section, "gross income" 
 22 

shall mean all income from all sources, and 

shall include, but not be limited to, income 

from salaries, wages, commissions, royalties, 

bonuses, dividends, severance pay, pensions, 

interest, trust income, annuities, capital 

gains, social security benefits except as 

listed below, workers' compensation benefits, 

unemployment insurance benefits, disability 

insurance benefits, veterans' benefits,

spousal support, rental income, gifts, prizes 

or awards. Gross income shall be subject to 

deduction of reasonable business expenses for 

persons with income from self-employment, a 

partnership, or a closely held business. 

"Gross income" shall not include benefits 

from public assistance programs as defined in 

§ 63.1-87, federal supplemental security 

income benefits, or child support received. 

(Emphasis added). Under Code § 20-108.2(C), gross income 

includes "all income from all sources," and unless specifically 

excluded, any income from any source is subject to inclusion. 

Clearly, Code § 20-108.2(C) does not specifically exclude 

voluntary contributions to retirement plans from the definition 

of gross income in a child support calculation. 

 While the statutory language does not specify the same 

scheme in a spousal support calculation, the same rationale is 

applicable. Thus, we hold that a spouse's voluntary 

contributions to a retirement account should be included in his 

or her gross income for both spousal and child support purposes. 

 A spouse and/or parent should not be allowed to voluntarily 

divert funds for retirement in order to exclude that income from 

consideration in determining spousal or child support. Code 

§ 20-107.1(1) requires the trial court in setting spousal support 

to consider the "earning capacity" of the parties. Although 
 23 

"earning capacity" necessarily includes actual earnings, it is a 

broader concept that allows the trial court to consider more than 

actual earnings. Nevertheless, a party's voluntary contributions 

to a retirement account are actual earnings that are merely set 

aside for the future, and such contributions or deferred income 

must be considered in determining a spouse's income and ability 

to pay spousal support. 

 The evidence established that husband voluntarily placed 

$30,000 per year in his retirement account with Frazer Sales. 

Husband unilaterally chose to contribute $30,000 of actual income 

into a retirement scheme of his own choosing and for his sole 

benefit. Wife's spousal support award was less than fifteen 

percent of the husband's voluntary contribution to his 

retirement. Although a support award is based upon a balancing 

of the parties' incomes and earning capacities and their 

respective needs, under these circumstances, the trial court 

erred in failing to include husband's voluntary contributions to 

his retirement account in his gross income for purposes of 

determining spousal and child support. 

 Wife also contends that the trial court awarded an 

inadequate amount of spousal support. Because we hold that the 

trial court should have included husband's voluntary 

contributions to his retirement plan in his income, on remand, 

the trial court shall reconsider its award of spousal support to 

wife in accordance with the factors of Code § 20-107.1. 
 24 

 CHILD SUPPORT

 (1) Modification after Appeal to Court of Appeals

 The final decree in this case was entered on July 7, 1995, 

and wife filed her notice of appeal in this Court on August 1, 

1995. The legislature enacted new statutory guidelines for child 

support effective July 1, 1995. In an August 3, 1995 order, the 

trial court found that the legislative change in the guidelines 

was a material change in circumstances and reduced husband's 

child support obligation. 

 Wife contends that the trial court erred in modifying the 

child support award after the final decree had been appealed to 

this Court. 

 "The orderly administration of justice demands that when an 

appellate court acquires jurisdiction over the parties involved 

in litigation and the subject matter of their controversy, the 

jurisdiction of the trial court from which the appeal was taken 

must cease." Decker v. Decker, 17 Va. App. 562, 564, 440 S.E.2d 

411, 412 (1994) (quoting Greene v. Greene, 223 Va. 210, 212, 288 

S.E.2d 447, 448 (1982)). This Court acquires jurisdiction over a 

case when the appeal is filed and docketed in the clerk's office 

of the Court. Id. "Thus, while the trial court may enforce a 

support and custody order, it may not modify such order without 

leave of court." Id.

 In this case, wife filed her first notice of appeal in the 

clerk's office of this Court on August 1, 1995, challenging the 
 25 

trial court's final decree of July 7, 1995. At that point, this 

Court acquired jurisdiction over the case. On August 3, 1995, 

two days after this Court acquired jurisdiction over the case, 

the trial court modified husband's child support obligation based 

upon the legislature's changes in the child support guidelines. 

Thus, the trial court had no jurisdiction to modify the child 

support award without leave from this Court. 

 (2) Wife's Spousal Support as Income

 Finally, wife asserts that the trial court erred in 

including her spousal support in her income when it calculated 

husband's child support obligation. 

 Code § 20-108.2(C) provides, in pertinent part, that 

"spousal support included in gross income [for child support 

purposes] shall be limited to spousal support paid pursuant to a 

pre-existing order or written agreement and spousal support shall 

be deducted from the gross income of the payor when paid pursuant 

to a pre-existing order or written agreement between the parties 

to the present proceeding." This Court has defined a 

"pre-existing order" as "an order that has continuing effect and 

that provides a spouse with an income source." Sargent v. 

Sargent, 20 Va. App. 694, 706, 460 S.E.2d 596, 601 (1995). 

However, a spousal support order must also "pre-exist" the child 

support calculation. Additionally, although a spousal support 

order must pre-exist the determination of child support, the 

plain meaning of Code § 20-108.2(C) contemplates spousal support 
 26 

"between the parties to the present proceeding." 

 In the instant case, the trial court did not err in 

including wife's spousal support in her income for child support 

purposes. The trial court should follow a three-step process in 

resolving issues of equitable distribution, spousal support, and 

child support. Because in determining child support under Code 

§ 20-108.2(C), the trial court must include spousal support in 

the gross income of the receiving spouse and must deduct the 

amount of spousal support from the gross income of the paying 

spouse, the court should first determine equitable distribution, 

then spousal support, and finally child support. Although the 

trial court properly included wife's spousal support in her 

income and deducted spousal support from husband's income, the 

court failed to include husband's voluntary contributions to his 

retirement account in husband's gross income for purposes of 

spousal or child support and must for both reasons recalculate 

the amount of child support on remand. 

INSURANCE POLICIES

 We find no error in the trial court's equitable distribution 

decision concerning the life insurance policies. The record 

clearly supports the trial court's resolution of these issues. 

In the absence of a showing of an abuse of discretion, we uphold 

these decisions. Srinivasan v. Srinivasan, 10 Va. App. 728, 732, 

396 S.E.2d 675, 678 (1990). 

 Accordingly, the trial court's rulings on the value of 
 27 

husband's business, the division of the Harmony Hills property 

and the insurance policies are affirmed. On remand, the trial 

court must reconsider equitable distribution, spousal support, 

and child support in accordance with this opinion. 

 Affirmed in part,

reversed in part,

and remanded.