Opinion ID: 1394944
Heading Depth: 1
Heading Rank: 3

Heading: Other Badges of Fraud

Text: The sale was made for insufficient consideration, and Richard maintained at least some interest in The Avenue subsequent to its sale. Other badges of fraud also suggest that Richard intended to defraud Kim of a substantial part of her share of The Avenue. First, the transfer was made in anticipation of an impending suit. Richard made the sale on December 31, 1984, just three days after Kim had served him with a complaint for divorce. Second, even if the sale did not leave Richard completely insolvent, the record suggests that his remaining assets might be insufficient to provide Kim with her half of the fair market value of the interest in The Avenue. Third, he failed to record the transaction promptly. The most significant portion of the parties' marital estate was sold without the knowledge of the wife or of the court having jurisdiction over the divorce. Fourth, the transfer encompassed substantially all the valuable property held by Richard. Fifth, although the transfer did not entirely deplete his assets (because he was left with the value of the note), it reduced his assets significantly. Moreover, once the note was shared with Kim the income from the remainder was far less than enough to pay his interim child support obligation. Finally, the sale was made to his brother. Richard made it clear that the sales price he negotiated was not the result of armslength bargaining, stating: I'm doing business with my family, and I'm not going to sit down there at the table and drive the hardest bargain I possibly can, as I would if I was dealing with somebody like you. Richard also stated, I was dealing with  with  well, people I loved. People that are related to me. People that wanted nothing but to help me ... Id. at 66. The record before us leaves us with the definite and firm conviction that Richard intended to defraud Kim of her share of the marital asset. Three days after Richard was served with divorce papers, he sold a valuable income-producing property to his brother at a very favorable price. His family now provides him with rent-free accommodation, money and a car. Thus, the trial court's contrary holding was clearly erroneous. See Alaska R.Civ.P. 52(a). Accordingly, we reverse and remand to the trial court for entry of judgment voiding the sale. On remand, the trial court must determine the fair market value of Richard's interest in The Avenue, by including the amount of its business good will and the present value of its assets. The court should revise the division of property accordingly.
The trial court ordered Richard to pay Kim, the custodial parent, $163 per child per month ($326 per month total) in child support. This was the total of Richard's income from the note given for his interest in The Avenue after the court divided the note between Kim and Richard. The court found that Richard had no other income except gifts from his mother, while Kim earned $1,340 (net) per month. The trial court has broad discretion to order child support payments by either or both parties ... as may be just and proper ... AS 25.24.160(a)(1); see Curgus v. Curgus, 514 P.2d 647, 649 (Alaska 1973). The relevant factors in allocating child support are the total costs of supporting the children and the relative financial position of the parties. Hunt v. Hunt, 698 P.2d 1168, 1172 (Alaska 1985). We will not reverse a child support award unless we have a definite and firm conviction based on the record as a whole that a mistake has been made or the trial court abused its discretion. Id. We must reverse this child support award for three reasons. First, our decision to void the sale of Richard's interest in The Avenue means that Richard will no longer receive income pursuant to the terms of the note he received on that sale, but as a partner in the bar. Second, the trial court clearly erred in failing to consider as part of Richard's available income the $1,000 monthly allowance he receives from his mother. Finally, we reject the trial court's implicit holding that a noncustodial parent who voluntarily reduces his or her income should automatically receive a corresponding reduction in his or her child support obligation. [7] Many courts hold that a voluntary reduction in an obligor-parent's income does not reduce a child support obligation. See, e.g., Villano v. Villano, 98 Misc.2d 774, 414 N.Y.S.2d 625, 629 (N.Y. Sup. Ct. 1979); Miller v. Miller, 65 Ill. App.3d 844, 22 Ill.Dec. 433, 382 N.E.2d 823, 826 (1978); see generally Annotation, Change in Financial Condition or Needs of Parents or Children as Ground for Modification of Decree for Child Support Payments, 89 A.L.R.2d 7, 54-58 (1963). On the one hand, we do not believe that an obligor-parent should be locked in to a particular job or field during the minority of his or her children when accepting a lower-paying position may ultimately result in personal or professional advancement. Weiser v. Weiser, 238 Pa.Super. 488, 362 A.2d 287, 288-89 (1976). On the other hand, the children of the marriage and the custodial parent should not be forced to finance the noncustodial parent's career change. We believe that the better rule is that stated by the Montana Supreme Court: [T]he judge [is] to consider the nature of the changes and the reasons for the changes, and then to determine whether, under all the circumstances, a modification is warranted. In re Marriage of Rome, 621 P.2d 1090, 1092 (Mont. 1981). We see no reason why this principle should not extend to initial child support award determinations. Hunt, 698 P.2d at 1172 (regarding the equitable allocation of costs of raising children). The record does not disclose why Richard has become a student, how long he anticipates being unemployed, or what his eventual career goals are. We believe that these are circumstances which will be relevant to determining his income for the purpose of establishing his child support obligation. Accordingly, we remand this case to the trial court for its determination of the reasonable needs of the children, the income available to both parents which may be used to meet those needs, and the appropriate child support award. REVERSED and REMANDED.