Opinion ID: 1794243
Heading Depth: 1
Heading Rank: 2

Heading: Underemployment Guideline.

Text: Jody argues that the trial court erred when it declared NDAC 75-02-04.1-07 unreasonable. We agree with Jody that this guideline remedy for underemployment was a reasonable exercise of the rule-making authority of the North Dakota Department of Human Services. An obligor's ability to pay child support is not solely determinable from actual income, and an obligor's earning capacity also can be utilized, we have often recognized in our past decisions. See Gabel, 434 N.W.2d at 724; Cook v. Cook, 364 N.W.2d 74, 76 (N.D.1985); Burrell v. Burrell, 359 N.W.2d 381, 383 (N.D.1985); Skoglund v. Skoglund, 333 N.W.2d 795, 796 (N.D.1983). See also Perry v. Perry, 382 N.W.2d 628, 629 (N.D. 1986) (obligor, who could seek and maintain employment which would allow him to meet his obligation for child support, could be held in contempt for failure to pay). The first child support guidelines did not specifically authorize imputation of income to an unemployed or underemployed parent. See Heley v. Heley, 506 N.W.2d 715, 722 (N.D. 1993); Spilovoy v. Spilovoy, 488 N.W.2d 873, 878 (N.D.1992). Yet, we explained in Olson v. Olson, 520 N.W.2d 572, 574 (N.D.1994), if an obligor with an established earnings history voluntarily, without good reason, places himself in a position where he is unable to meet his child support obligations, income compatible with his prior earnings history may be imputed in calculating child support under the guidelines. Olson 's rule of reason, however, preceded the adoption of the specific child-support guideline allowing the imputation of income based on an obligor's earning capacity. See id. at 573 n. 1; see also Schatke v. Schatke, 520 N.W.2d 833 (N.D.1994). Effective January 1, 1995, the Department amended the guideline definition of gross income to include income imputed based upon earning capacity, NDAC 75-02-04.1-01(5), and amended NDAC 75-02-04.1-07 to create methods for imputing income to an underemployed obligor. For the guidelines, an obligor is `underemployed' if the obligor's gross income from earnings is significantly less than prevailing amounts earned in the community by persons with similar work history and occupational qualifications. NDAC 75-02-04.1-07(1)(b). An obligor is presumed to be underemployed if his or her gross earnings is less than six-tenths of prevailing amounts earned in the community by persons with similar work history and occupational qualifications. NDAC 75-02-04.1-07(2). The guideline defines community as any place within one hundred miles ... of the obligor's actual place of residence. NDAC 75-02-04.1-07(1)(a). If the obligor is underemployed, income is imputed under NDAC 75-02-04.1-07(3), based on earning capacity, less actual gross earnings. [1] Here, the trial court determined that NDAC 75-02-04.1-07 was unreasonable and unnecessary and therefore in excess of the Department's rule-making authority. Specifically, the court found the huge size of the purported `community' bears no rational relation to the availability of jobs within the area, and no discretion is left to the Court to choose among available alternatives. Instead of using the underemployment guideline, the trial court used Olson 's pre-guideline rule of reason. Finding Keith's decision to start his own business to be reasonable under the facts of this case, the trial court did not impute any income to him. The Legislature gave the Department broad statutory authority to establish child support guidelines: The department of human services shall establish child support guidelines to assist courts in determining the amount that a parent should be expected to contribute toward the support of the child under this section. The guidelines must: a. Include consideration of gross income. b. Authorize an expense deduction for determining net income. c. Designate other available resources to be considered. d. Specify the circumstances which should be considered in reducing support contributions on the basis of hardship. NDCC 14-09-09.7(1) (emphasis added). See Eklund, 538 N.W.2d at 187. As noted above, our pre-guidelines cases recognized that an obligor's earning ability was an available resource for setting child support. Thus, the amended guideline neither conflicts with our prior decisions, see Hecker v. Stark County Social Serv. Bd., 527 N.W.2d 226, 232 (N.D. 1994), nor conflicts with, or exceeds the scope of, the statute authorizing the Department to establish child support guidelines. See Little v. Tracy, 497 N.W.2d 700, 704 (N.D.1993); see also Spilovoy, 488 N.W.2d at 878 (If a minimum wage income should be imputed to a child support obligor under these circumstances, that argument is best made to the agency promulgating the guidelines and, if failing there, to the Legislature.). We disagree with the trial court that the Department exceeded its authority in amending NDAC 75-02-04.1-07 to authorize the imputation of income based on earning capacity. The trial court ruled that the guideline definition of community was excessive. However, we cannot say that the Department acted arbitrarily or capriciously in adopting this definition. See NDCC 28-32-19.1(4); see also Ames v. Rose Township Bd. Of Township Supervisors, 502 N.W.2d 845, 851 (N.D.1993). While we understand the trial court's uneasiness with the wide scope of the definition of community, we cannot substitute our view for that of the Department. See Scherling v. Scherling, 529 N.W.2d 879, 882 (N.D.1995). If application of the community definition proves to be too awkward, or if its effect turns out to be unfair, then improvements can and should be suggested to either the Department or the Legislature. The trial court also ruled that the Department's adoption of the underemployment guideline was an improper intrusion into judicial discretion. In its Memorandum Opinion, the trial court complained that application of the guideline would effectively rob the Judicial Branch of any meaningful discretion in child support cases ... and only a cruel illusion [of justice] would remain. We disagree that imputing income to a significantly underemployed obligor is an improper intrusion into judicial discretion, or that the imputation will hinder the administration of justice. Obviously, the child support guidelines redefine the responsibilities once loosely delegated to the judiciary, but the Legislature rationally decided that greater specificity and uniformity were necessary in the determination and enforcement of child support payments. This particular guideline represents no more of an improper intrusion into judicial discretion than do any of the others. Moreover, the new guideline still allows a court to exercise considerable discretion when determining whether an obligor meets the definition of underemployed. See NDAC 75-02-04.1-07(1)(b) (An obligor is `underemployed' if the obligor's gross income from earnings is significantly less than prevailing amounts earned in the community by persons with similar work history and occupational qualifications. (emphasis added)). Under NDAC 75-02-04.1-07(2), an obligor is only presumed to be underemployed if he or she is earning less than sixty percent of the relevant prevailing wage in the community. Under NDREv 301, a presumption is rebuttable and may be overcome by contrary evidence weighed by the judge. Judicial discretion thus continues. We also disagree that imputing income to an underemployed obligor is somehow unjust. A parent has a duty to support his children to the best of his abilities, not simply to his inclinations. The underemployment guideline represents the Department's effort to balance an obligor's freedom to make reasonable employment decisions with his duty to support his children diligently. An obligor is still free to switch jobs, or become self-employed. However, if that voluntary change results in the obligor becoming underemployed, then the obligor who made the change should make a greater sacrifice than his children.