Opinion ID: 3133193
Heading Depth: 3
Heading Rank: 1

Heading: Housing allowance

Text: Terri Lin argues that the superior court erred by crediting Terry with $2,202 toward his monthly child support obligations based on her residence with the three children during the pendency of the divorce in housing paid for by Terry’s military housing allowance. Because the Ruppes’ living situation provided “good cause” to vary the interim child support award, we affirm the superior court’s decision to allow Terry to partially satisfy his interim child support obligations by paying for housing for Terri Lin and the children. But we reverse the superior court’s decision to credit Terry’s “overpayments” during the interim period against his post-divorce obligations. There are a number of principles that are relevant to this appeal. “The right to support is that of the child,”17 and therefore the amount of child support calculated under Civil Rule 90.3 cannot be waived or modified other than for good cause.18 “[A]n agreement between the parties as to child support is not an exceptional circumstance justifying deviations from the guidelines, where the agreement requires support less than that called for by the guidelines.”19 And although “spousal support is separate and distinguishable from marital property,”20 those two matters are linked by the similar 17 State, Dep’t of Rev., Child Support Enforcement Div. ex rel. Valdez v. Valdez, 941 P.2d 144, 154 n.14 (Alaska 1997). 18 See Cox v. Cox, 776 P.2d 1045, 1049 (Alaska 1989). 19 Id.; see also Alaska R. Civ. P. 90.3 cmt. VI.B.1 (“The fact that the parties . . . agree on an amount of support is not reason in itself to vary the guidelines.”). 20 Stevens v. Stevens, 265 P.3d 279, 288 (Alaska 2011). -9- 7052 factors that determine each one21 and the preference in Alaska courts that spousal maintenance only be awarded if financial concerns cannot be resolved by property division.22 With these principles in mind, we turn to the facts of this case. Civil Rule 90.3 contains a formula that determines child support obligations on the basis of parents’ adjusted annual income, the physical custody arrangement, and the number of children the award will support. We have explained that the formula “reflect[s] a paternalistic view toward child support agreements,”23 and the commentary to the Rule states that two of the major purposes of the formula are to “ensure that child support orders are adequate to meet the needs of children, subject to the ability of parents to pay” and to make child support awards “[p]redictable and consistent.”24 “The right 21 Compare AS 25.24.160(a)(2) (factors for maintenance awards), with .160(a)(4) (factors for property division); see also AS 25.24.160(a)(2)(F) (spousal maintenance award should be based, in part, on the division of property). For example, in Hanlon v. Hanlon, 871 P.2d 229, 233 (Alaska 1994), we found that “[a]lthough the factors trial courts consider in determining whether to award spousal support are essentially identical to those considered in deciding the allocation of marital property, spousal support and property-division serve distinct purposes and are not interchangeable. ‘We have announced a policy of encouraging trial courts to provide for parties’ financial needs by property disposition, rather than by alimony.’ ” (citations omitted) (quoting Dixon v. Dixon, 747 P.2d 1169, 1173 (Alaska 1987)). 22 See, e.g., Fernau v. Rowdon, 42 P.3d 1047, 1058 (Alaska 2002) (“The preference in Alaska is to resolve the financial concerns arising from a divorce by means of the property division, but spousal maintenance may be awarded if it is just and necessary.” (citation omitted)). 23 Laughlin v. Laughlin, 229 P.3d 1002, 1004 (Alaska 2010) (quoting Cox, 776 P.2d at 1048). 24 Alaska R. Civ. P. 90.3 cmt. I.B. -10- 7052 to support is that of the child,”25 and the support that results from application of the formula is presumed to contribute to the child’s multiple needs, which include food, housing, and clothing. Crediting payments that provide a home for a spouse and children against child support obligations risks leaving children with insufficient support. Such a practice may dedicate a greater percentage of the total support children are owed to housing costs than the custodial parent would choose to dedicate and may deprive the custodial parent of the ability to provide for the child’s other needs.26 The formula in Civil Rule 90.3 does not anticipate a support order that dedicates an unwieldy percentage of the non­ custodial parent’s monthly requirement to only one of the multiple needs of the children. It is possible, however, that the Ruppes’ situation is one in which the child support obligation calculated under the usual formula should be varied.27 Civil Rule 90.3(c)(1) permits the court to “vary the child support award as calculated under 25 State, Dep’t of Rev., Child Support Enforcement Div. ex rel. Valdez v. Valdez, 941 P.2d 144, 154 n.14 (Alaska 1997). 26 Cf. Young v. Williams, 583 P.2d 201, 203 (Alaska 1978) (affirming trial court’s refusal to credit voluntary payments against child support obligations because “such voluntary payments to the children quite often are intended for particular purposes whereas the manner in which child support payments are used to meet the children’s basic needs is left to the discretion of the parent or guardian with custody”). 27 The military housing allowance represented roughly 40% of Terry’s gross annual income but was significantly less flexible than the equivalent value in wages. It is not clear from the record whether the allowance could have paid for two smaller residences during the pendency of the divorce or whether it was in effect committed to the home that continued to house Terri Lin and the children. Aurora Military Housing, the company that provides on-base housing at Fort Richardson, sets the rent for each service member tenant as “equal to the BAH with dependent rate for [that service member’s] rank.” Frequently Asked Questions, A URORA M ILITARY H OUSING , http://www.auroramilitaryhousing.com/faqs#rent-bah (last visited Sept. 14, 2015). -11- 7052 the other provisions of this rule for good cause upon proof by clear and convincing evidence that manifest injustice would result if the support award were not varied.” “The ‘good cause’ inquiry ‘must focus first and foremost on the needs of the children.’ ”28 This exception can encompass a variation that reflects the obligor’s separate provision of a service that would normally be funded out of the child support award.29 Such a variation may be particularly appropriate when the superior court is examining parents’ conduct before any child support order was entered.30 Although we have held “that absent extraordinary circumstances, courts should apply the calculation methodology of Rule 90.3 to determine amounts to be reimbursed to custodial parents for support of children during periods not covered by support orders,”31 the commentary to Rule 90.3 notes that “in some circumstances unfairness may result from rigid [retroactive] application of the rule.”32 28 Koller v. Reft, 71 P.3d 800, 807 (Alaska 2003) (emphasis in original) (quoting Doyle v. Doyle, 815 P.2d 366, 373 (Alaska 1991)). 29 See Coats v. Finn, 779 P.2d 775, 777 (Alaska 1989) (“ ‘[G]ood cause’ may be present when application of the formula produces a result which requires the non-custodial parent, unreasonably, to contribute substantially more or less than his or her fair share of the amount needed to satisfy the child’s reasonable needs.”). The Alaska Administrative Code’s regulations governing the Child Support Services Division anticipate crediting “in-kind contributions against an obligor’s child support obligation if . . . a tribunal of competent jurisdiction has ordered the in-kind contribution in lieu of the payment of child support,” 15 Alaska Administrative Code (AAC) 125.470(a)(1) (2014), an indication that in-kind contributions may be appropriate components of superior court child support orders in some circumstances. 30 See Ogard v. Ogard, 808 P.2d 815, 816-17 (Alaska 1991). 31 Vachon v. Pugliese, 931 P.2d 371, 382 (Alaska 1996). 32 Alaska R. Civ. P. 90.3 cmt. VI.E.1; see also 15 AAC 125.105(c) (stating (continued...) -12- 7052 Here, although the superior court erred by not analyzing the Ruppes’ circumstances according to the requirements of Civil Rule 90.3(c)(1),33 we detect no error in its conclusion that Terry satisfied his interim child support obligations. Terry paid Terri Lin $2,200 directly every month during the pendency of the divorce, and in addition his employment paid for her and the children’s home. Taken together, these contributions satisfied Terry’s $2,407 monthly interim child support obligation, as well as the $593 monthly interim spousal support obligation that the Ruppes and the superior court appear to have assumed would not apply until Terri Lin and the children moved out of on-base housing. A variation of either $207 or $800 per month to reflect Terry’s provision of housing was not legal error. As Terri Lin testified at trial, the additional $800 she believed she was owed each month during the pendency of the divorce could not have paid for housing comparable to the on-base housing she and the children enjoyed during that time. Although we affirm the conclusion that Terry satisfied his interim support obligations, the superior court’s treatment of Terry’s child support obligations following the divorce constituted legal error. The July 15, 2013 order concluded that Terry had overpaid during the period between the Ruppes’ separation and final divorce, and so awarded him a $14,35734 credit against his future obligations. This conclusion ignores 32 (...continued) that the Child Support Services Division “will give credit for [pre-order] in-kind contributions” under certain circumstances). 33 See Alaska R. Civ. P. 90.3(c)(1) (“The court must specify in writing the reason for the variation, the amount of support which would have been required but for the variation, and the estimated value of any property conveyed instead of support calculated under the other provisions of this rule.” (emphasis added)). 34 We note that this figure appears to have been the result of a math error. It (continued...) -13- 7052 the fact that Terry paid Terri Lin the amount he proposed at the February hearing: $2,200 per month plus the housing, while she remained in the house. The supposed overpayment only emerges by comparing the full dollar value of what Terry contributed to Terri Lin with the result of the Rule 90.3 formula. But contributing more than the formula dictates is not an overpayment when it is done pursuant to the parties’ proposed compromise. Even if Terry had paid Terri Lin too much during the interim period, it was error to credit any voluntary overpayment against his future obligations. We have held that “it is contrary to the purpose of Civil Rule 90.3 to offset such contributions against future child support payments except in exceptional circumstances.”35 In that case, Epperson v. Epperson, we suggested that such an offset should be recognized only if the parties agreed at the time the contributions were made that they would constitute prepayment of future child support.36 34 (...continued) was reached by comparing the amounts Terry paid to Terri Lin with the interim child support obligation established in the March 2013 order. However, the March 2013 order also required Terry to pay Terri Lin $593 in monthly interim spousal support. Thus, even by its own terms the superior court’s July 15, 2013 order overstated Terry’s overpayment by $4,151. 35 Epperson v. Epperson, 835 P.2d 451, 453 (Alaska 1992); cf. 15 AAC 125.105(d) (“When giving credit for direct payments . . . or in-kind contributions [made before an order is entered], the agency will give credit only up to the amount of the support that is charged for the [pre-order] period . . . .”). 36 See 835 P.2d at 453 (“On the record presented, it is clear that the court did not abuse its discretion in ruling that the ‘gifts’ [the husband] made to [the wife] could not be credited against his child support obligation. [The husband] does not claim that he and [the wife] agreed that his contributions were to constitute prepayment of future child support.”). -14- 7052 Such “exceptional circumstances” were not present here. As explained above, Terry’s payments were made pursuant to a payment plan that he proposed. During the pendency of the divorce Terry did not directly pay Terri Lin the amount prescribed by Civil Rule 90.3, and while his provision of housing easily satisfied the difference between what he did pay and that prescribed amount, any excess value of that housing should not have been credited against his future child support obligations.