Source: https://mn.gov/law-library-stat/archive/ctapun/9808/2113.htm
Timestamp: 2019-04-23 05:58:59+00:00

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In Re the Marriage of: Negatu Mekuria, petitioner, Appellant, vs. Genet Mekuria, a/k/a Genet Beyene Bereded, a/k/a Genet Beyene, a/k/a Genet Hatter, Respondent. C9-97-2113/C8-97-2297, Court of Appeals Unpublished, August 18, 1998.
Considered and decided by Lansing, Presiding Judge, Norton, Judge,** and Schultz, Judge.
Negatu Mekuria appeals from two postdecree orders issued by a family court referee and countersigned by the district court. The first, entered October 17, 1997, awarded appellant's nonmarital rental property to respondent Genet Mekuria, based upon a finding of unfair hardship and in partial satisfaction of child support and spousal maintenance arrears. The second, entered November 17, 1997, modified appellant's child support obligation by excluding the rental income from appellant's net income and reducing his child support obligation from $605 to $520.32 per month. Because the district court did not clearly err or otherwise abuse its discretion, we affirm.
The parties were married in August 1995 and separated three months later, in November 1995. At the time, respondent was unemployed and pregnant with their child, who was born in March 1996. Appellant was self-employed and operated a computer assembly and parts business out of his home in St. Paul; he also owned rental property in Minneapolis.
The May 1997 judgment and decree set appellant's child support obligation at $605 per month and awarded respondent monthly spousal maintenance of $450 for six years. Respondent moved for a new trial or amended findings, seeking an award of appellant's nonmarital rental property to satisfy appellant's child support and maintenance arrears and to give her a place to live.
In the October 1997 order, the district court found a substantial change in circumstances existed due to appellant's continuing failure to pay child support and maintenance as ordered, awarded appellant's nonmarital rental property to respondent based on a finding of unfair hardship, and ordered $14,190 in child support and maintenance arrears satisfied because doing so was fair and equitable based on the award of the nonmarital property. In the November 1997 order, the court recognized appellant's loss of rental income, recalculated his net income, and reduced his child support obligation to $520.32 per month. The court further denied appellant's motion to modify or terminate his spousal maintenance obligation.
is equal to gross receipts minus ordinary and necessary expenses. * * * The person seeking to deduct an expense, including depreciation, has the burden of proving, if challenged, that the expense is ordinary and necessary. Net income under this section may be different from taxable income.
Minn. Stat. § 518.551, subd. 5b(e) (Supp. 1997).
In this case, the district court initially found appellant's monthly net income to be $2,419.52, accepting respondent's compilation of appellant's financial information for the period from January 1, 1996, through April 30, 1996. The court explained that this figure was based upon total sales, less purchases and expenses, plus rental income from appellant's nonmarital rental property, minus deductions for federal taxes, social security, and state taxes. In recognition of the loss of rental income after the nonmarital rental property was awarded to respondent, the court recalculated his net monthly income to be $2,081.29 and reduced his child support obligation to $520.32 per month.
These calculations follow the statutory requirements for determining the net income of a self-employed obligor. The district court was free to reject the testimony of appellant and his trial expert, a certified public accountant, who estimated appellant's net income was only $430 per month, as not credible and inconsistent. See Minn. R. Civ. P. 52.01 (trial judge entitled to judge credibility of witnesses). While the court adopted figures presented by respondent, those figures were based on the most recent information submitted by appellant regarding his income and expenses. Cf. Thomas v. Thomas, 407 N.W.2d 124, 127 (Minn. App. 1987) (trial court erroneously determined net income based on obligor's tax return from previous year when income figures for first half of current year were available). Finally, appellant has failed to point us to any specific flaws in the district court's calculations, and we can find none. We therefore affirm the district court's determination of appellant's net income as having a reasonable basis in fact.
Appellant argues that the district court improperly set his spousal maintenance obligation at $450 per month. Appellant did not challenge the court's findings in the judgment and decree regarding the basis for the maintenance award or the amount of maintenance. Rather, in each postdecree motion, he has argued that maintenance should be reduced or terminated because he lacks the ability to pay. Thus, his request is in the nature of a motion to modify maintenance.
A district court may modify a spousal maintenance obligation only if it finds that there has been a substantial change in circumstances that makes the prior award unreasonable and unfair. Minn. Stat. § 518.64, subd. 2(a) (Supp. 1997). In connection with the latest postdecree motion, which resulted in the November 1997 order, appellant claimed that the loss of his nonmarital rental property and respondent's corresponding gain of possible rental income, constituted a substantial change of circumstances justifying termination of his maintenance obligation.
The district court found that appellant failed to submit sufficient proof that respondent is in fact receiving $500 per month in rent from the property. The court further found that when it set the amount of spousal maintenance in October 1996, respondent would still experience a shortfall of $435 between her monthly expenses and her income from child support and maintenance. The court did not abuse its discretion in concluding that appellant had failed to show a substantial change in respondent's income or resources, so as to warrant modification. See Wiese v. Wiese, 295 N.W.2d 371, 372 (Minn. 1980) (maintenance award should be modified only on "clear proof of facts showing a substantial change of circumstances").
Appellant argues that he should have been given credit towards his future child support and spousal maintenance obligations because the trial court awarded his nonmarital rental property, with a net equity of $32,000, to respondent in partial satisfaction of his arrears on those obligations, which totaled $14,190. He thus reasons that he is entitled to a credit of $17,810, which would cover his current child support and maintenance payments for the next two years.
The trial court awarded this nonmarital property to respondent based in part on a finding of unfair hardship and in partial satisfaction of his child support and maintenance arrears. As respondent notes, appellant "does not contest the fact that the trial court effected an invasion of his non-marital property" under Minn. Stat. § 518.58, subd. 2 (1996). In addition, when respondent requested that this nonmarital property be awarded to her, appellant never sought a credit or otherwise objected that his equity in the property exceeded the amount of arrears. Because appellant never requested this relief from the trial court and is raising it as an issue for the first time on appeal, we decline to address it. See Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988).
The district court's postdecree orders are affirmed.
*Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.
**Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.
 Indeed, appellant claims in his brief on appeal that the bank has foreclosed on the property. Thus, respondent may no longer have possession and it may not be a resource available to her.

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