Court Opinion

ID: 5173055
Source: CourtListenerOpinion
Date Created: 2022-01-02 05:10:38.040333+00
Date Added: 2024-06-11T08:26:10.159509
License: Public Domain

HUNTLEY, Justice.
Respondent Dawn Louise Lester and appellant Theodore Lester were divorced on March 24,1972. The divorce decree, adopting a portion of the parties’ oral marriage dissolution agreement, set up a schedule requiring appellant to pay child support based on his “income”, i.e., the higher his “income”, the more child support he would be obligated to pay. On September 20, 1974, respondent brought an order to show cause asking that appellant be held in contempt for failure to pay the full amount of child support due. The trial court found the word “income” in the divorce decree to be ambiguous and, after taking evidence on the issue, determined that the parties intended it to mean “taxable income” as defined by the Internal Revenue Code.1 The respondent appealed that finding, and the trial court’s decision was upheld by this *245Court in Lester v. Lester, 99 Idaho 250, 580 P.2d 853 (1978) (hereinafter Lester I).
For the years 1975 and 1978, appellant and his present wife, Jeannette, filed separate federal income tax returns, each claiming as individual income one-half of the community income. For those two years, in paying his child support appellant made payments based only on that income reported in his separate federal income tax return. On March 28, 1979, a motion for an order to show cause was again filed by the respondent. At hearings based upon that motion, the trial court determined that child support should have been calculated on the entire community income. The trial court found that the defendant (appellant) “willfully and deliberately used the device of filing separate income tax returns in each of the years 1975 and 1978 for himself and his present wife, Jeannette, in order to ‘reduce’ his taxable income to avoid paying the higher child support payments required and contemplated by paragraph 5 of the decree of divorce.” (Emphasis added.)
Mr. Lester asserts the trial court erred in concluding that income “refers to the total community income of Mr. Lester and his present wife.” Mr. Lester argues that his construction of the meaning of the term “income” is consistent with the law, the Lester I decision, and the intent of the parties as discernable from the divorce decree itself. As support for his proposition, he relies on community property law and federal income tax law. Basically, his argument is that since all property acquired during marriage is community property with each spouse having a vested share of one half, his income should be measured by that one half figure. In Lester I the court held that income as used in the divorce decree meant taxable income as defined in section 63 of the Internal Revenue Code. Under federal income tax law, Mr. Lester and his present wife can file separate returns, dividing the income received by them and declaring each half as individual income. We do not dispute Mr. Lester’s right to split his income for income tax purposes. However, the effect will not reduce his child support obligation.
The issue on appeal is the meaning of the term “income” as used in the divorce decree.
When a court hearing an action to enforce a judgment finds the judgment ambiguous, it may refer to the circumstances surrounding the making of the judgment in attempting to interpret it. Lester v. Lester, 99 Idaho 250, 580 P.2d 853 (1978), citing Evans v. City of American Falls, 52 Idaho 7, 11 P.2d 363 (1932).
The term “income” remained ambiguous even after the court defined it in Lester I. The court stated: “The term ‘taxable income’ is the remainder of a person’s adjusted gross income after subtracting the individual’s itemized deductions and the exemption allowance which are allowable by the Internal Revenue Code.” The finding was that the parties meant net income, but what his income consisted of is not implicit in the definition. At the trial in Lester I, Mr. Lester supplied affidavits in which he stated his income was that of the entire community; he submitted his joint tax returns to show what his income had been, and he never contended at the prior hearings that his income was one half of what he was asserting it to be. The term income remains ambiguous because it does not define what income the term is to be applied to, the community, or his interest in the community.
While the trial court did not make a specific finding that the term “income” was ambiguous, a reading of its memorandum decision implies that such was its finding. The trial court, quoting from defendant’s memorandum in Lester I, stated:
“No authority need be cited for the proposition that it is in the power of, the court to resolve any ambiguity in the terms of any instrument and that the court is empowered to determine the ‘intent’ of the parties from the law and all the facts and circumstances surrounding the situation out of which the issue arose.
*246Our court has said:
“From the above authorities, the rule deducible as to what definition is to be given the word ‘proceeds’ is that the intention of the parties governs and is to be gathered from all of the surrounding facts and circumstances .... ” Furst & Thomas v. Elliott, 56 Idaho 491, 502-503 [56 P.2d 1064].

Conclusions

We suggest that the manifest ‘intent’ of the parties was to provide for the children’s support (Decree, paragraph V— Support Payments) and care (Decree, paragraph II — Setting Over Family Home to Plaintiff, paragraph VII — Medical-Dental Care, paragraph VII [sic]— Will in Favor of Children) in a manner commensurate with their needs and life style and consistent with their father’s ability to pay, and that the funds to meet the financial obligations assumed by the defendant would come from the defendant’s farming operations (Decree, paragraph III — Setting over Farm Lands, Cattle, Farm Machinery, etc., to the defendant).”
Having concluded that the term remained ambiguous, the trial court was free to look to the parties’ intent to construe the agreement.
The district court in its memorandum decision in this case states that the affidavits presented by the defendant in Lester I referred to the entire community income. The income tax returns upon which the judge relied reflected the entire community income. The trial court found that when the parties entered into the stipulation in 1972, neither party contemplated the possibility of splitting the farm and ranch income. Mr. Lester’s major source of income then was the farming and ranch operations. The formula for computing the child support obligation was based upon the knowledge of both parties as to the past'community income derived from this farming operation. There was no contemplation on their part that defendant could or would seek to avoid the stipulated payment schedule by the device of splitting the community income derived from the farming operation. The district judge presided over both the Lester I and the Lester II cases.
We have reviewed the record, findings of fact and conclusions of law and find that they are supported by substantial and competent evidence. Therefore, the order will not be reversed on appeal. Foremost Ins. Co. v. Putzier, 102 Idaho 138, 627 P.2d 317 (1981); Cougar Bay Co. Inc., v. Bristol, 100 Idaho 380, 597 P.2d 1070 (1979).
Judgment affirmed. Costs to respondent.
DONALDSON, C.J., and SCOGGIN, J. Pro Tern., concur.

. The original wording of the decision of the trial court issued on August 6, 1975, which was appealed and affirmed in Lester I, reads as follows:
“The Court finds however that the parties intended the word ‘income’ to mean ‘taxable income,’ as the word is defined and used for purposes of defendant’s federal income tax return. The term ‘taxable income’ is the remainder of a person’s adjusted gross income after subtracting the individual’s itemized deductions and the exemption allowance which are allowed by the Internal Revenue Code.”