Court Opinion

ID: 4214559
Source: CourtListenerOpinion
Date Created: 2017-10-25 14:03:32.022172+00
Date Added: 2024-06-11T07:47:07.279932
License: Public Domain

Cite as 2017 Ark. App. 556

                   ARKANSAS COURT OF APPEALS
                                           DIVISION I
                                         No. CV-16-1028

HEATHER KIRBY f/k/a HEATHER                          Opinion Delivered   October 25, 2017
SEMEYN
     APPELLANT/CROSS-APPELLEE                        APPEAL FROM THE STONE
                                                     COUNTY CIRCUIT COURT
                                                     [NO. 69DR-99-40]
V.
                                                     HONORABLE HOLLY L. MEYER,
                                                     JUDGE
JEFFREY SEMEYN
     APPELLEE/CROSS-APPELLANT                        AFFIRMED ON DIRECT APPEAL;
                                                     REVERSED AND REMANDED ON
                                                     CROSS-APPEAL

                            PHILLIP T. WHITEAKER, Judge

       Heather Kirby and Jeffrey Semeyn were divorced in January 2003. Heather was

awarded custody of the parties’ two children, and Jeffrey was ordered to pay child support.

In April 2015, Heather filed a petition for an increase in child support and for arrears in child

support. The Stone County Circuit Court granted her request for an increase in child support

but denied her request for arrears. Both parties have appealed the court’s order. Heather

appeals the denial of her request for child-support arrearages, and Jeffrey cross-appeals the

award of increased child support. He also appeals the trial court’s award of interest and

attorney’s fees.

       Our case law is well settled. We review domestic-relations cases de novo, but we will

not reverse a trial court’s finding of fact unless it is clearly erroneous. Berry v. Berry, 2017 Ark.

App. 145, at 2, 515 S.W.3d 164, 166; Hunter v. Haunert, 101 Ark. App. 93, 270 S.W.3d 339
                                 Cite as 2017 Ark. App. 556

(2007). A finding is clearly erroneous when, although there is evidence to support it, the

reviewing court is left with a definite and firm conviction that the trial court has made a

mistake. Hunter, supra. In reviewing a circuit court’s findings of fact, we give due deference

to the court’s superior position to determine the credibility of the witnesses and the weight

to be accorded to their testimony. Brown v. Brown, 373 Ark. 333, 284 S.W.3d 17

(2008); Blalock v. Blalock, 2013 Ark. App. 659. Based on this standard of review, we affirm

on direct appeal and reverse and remand on cross-appeal.

       Before addressing the specific arguments raised on direct appeal and on cross-appeal,

we must consider certain provisions of the parties’ divorce decree that are relevant to the

arguments presented. Heather and Jeffrey entered into a property-settlement and child-

custody agreement that was eventually incorporated into their divorce decree. At the time of

the decree, Jeffrey was a student in medical school, but the parties anticipated that he would

eventually graduate, begin and complete a residency, and then begin a medical practice. With

this in mind, they designed the child-custody agreement to take care of their two children,

one of whom has Down syndrome and will require a lifetime of care.              With respect to

support and maintenance of the children, Heather and Jeffrey agreed:

              5. Support and maintenance of the children. [Jeffrey] shall pay child support
       in the amount of $407.40 per month beginning the 1st day of March, 1999 until he
       begins his medical residency. The same shall become due and payable on the 1st and
       15th day of each month payable through the Clerk of Stone County Circuit Court,
       HC 71, Box 1, Mountain View, AR 72560.

               The obligation of [Jeffrey] to pay child support shall continue until said children
       have obtained the age of eighteen (18) years, graduates from high school, dies or
       marries, whichever event is the first to occur. However, due to the disabilities of the
       parties minor child, [JPS], child support shall continue during his lifetime. Child

                                                2
                          Cite as 2017 Ark. App. 556

support shall be computed annually and shall be commensurate with the Arkansas
Child Support Chart.

       The parties acknowledge that [Jeffrey] is in arrears in child support and
medical/dental expenses. Said arrearage shall be computed at the time [Jeffrey] begins,
or should begin, his medical residency. [Jeffrey] shall pay the sum of $300.00 per
month for six (6) months and the sum of $400.00 per month for six (6) months
thereafter in addition to the regular monthly child support payment to cure such child
support arrearage. At the end of one (1) year from the date [Jeffrey] begins, or should
begin, his medical residency, the existing balance shall be reevaluated and amortized
over a period of four (4) years at the current interest rate for a loan of similar nature
and he shall make monthly payment to pay said amount in full within forty-eight (48)
months. [Jeffrey] shall compute the then current amount and supply calculations to
the wife. Once the amount is agreed upon, then[Jeffrey] shall immediately have a
proper petition and order prepared and entered at his cost reflecting the then current
amount. If [Jeffrey] shall fail to do the above, then the wife may compute the amount
and petition the court and all costs, expenses, and attorney’s fees incurred by her shall
be taxed to the husband and he shall immediately pay the same. If the then current
amount is not agreed upon, then it shall be submitted to this court and all costs,
expenses, and attorney’s fees incurred shall be taxed to the party that was most in error
on the computations.

         It is contemplated by the parties that [Jeffrey] will not have the arrearage paid
off at the time he begins his medical residency. At the time [Jeffrey] begins, or should
begin, his medical residency, then the child support and medical/dental expense
arrearage shall be ascertained and support at time shall be modified to the current
amount that he should then owe according to the Arkansas Child Support Chart. An
additional sum shall be added by agreement of the parties or by a court of competent
jurisdiction in Arkansas, to alleviate the arrearage. It is contemplated by the parties
that there may be more arrearage subsequent to the execution and entrance of the
Decree of Divorce and such arrearage shall be computed at the time [Jeffrey] begins,
or should begin, his medical residency and those amounts will be considered in
computing the total arrearage that [Jeffrey] owes and shall be calculated in figuring the
amount of monies he shall have to pay monthly to cure any arrearage.

        In order to keep track of the amount of medical/dental and other healthcare
related expenses, [Heather] shall provide [Jeffrey] copies of all billing statements. If
[Jeffrey] objects to any such medical expense as being his liability in whole or in part,
then he shall, within ten (10) days of receipt, contact [Heather] in writing of his
objection to any disputed medical expenses. If [Jeffrey] has objected to any medial
expense that is later held to be his expense, then he shall pay any and all court costs,
attorneys fees, and other expenses related to this matter.

                                        3
                                Cite as 2017 Ark. App. 556

               Each of the parties shall exchange tax returns annually. In the event that
       [Jeffrey] shall receive any type of income tax refund, then the same shall be paid to
       [Heather] and she shall credit said sum toward the amount of back child support
       arrearage.

       ....

              The custodial parent reserves the right to seek reevaluation of the child support
       required amounts to be paid by the non-custodial parent in the event that he were to
       gain a material increase in income of more than $100.00 per month, under the material
       change of circumstances of A.C.A. 9-14-107 of 1997 for bringing such cause of action.

The parties also agreed to set up a special-needs trust to provide for the care of JPS. With

respect to the funding of the trust, they agreed in part to the following:

       Debts, Insurance Obligations and Medical Expenses of the Children.

       ....

              The parties agree to establish a Trust Fund account for the minor child, [JPS],
       with each party putting three percent (3%) of their gross income into said Trust Fund
       account and the same shall start when [Jeffrey] begins his medical residency. The Trust
       Fund monies shall be used solely for the care, education, welfare, and well being of
       [JPS] so as to keep him in the same condition in life to which he has become
       accustomed. Each party shall purchase a policy of life insurance in the amount of
       $250,000.00 when [Jeffrey] begins his medical residency. The Trust Fund established
       for [JPS] shall be the owner and beneficiary of both life insurance policies.

We will now consider the arguments on appeal.

                                       I. Direct Appeal

       As previously mentioned, Heather sought an increase in child support for JPS.1 At the

trial level, she argued that the child-custody agreement required annual computations of child

       1
        Although JPS was emancipated at the time of the request for an increase in child
support, Jeffrey was ordered to pay child support for JPS for life under the provisions of the
decree. The parties’ other child had reached the age of majority and was not the subject of
any request for modification of child support herein.

                                              4
                                 Cite as 2017 Ark. App. 556

support and contained an automatic escalation clause. She took the position that Jeffrey had

a duty to annually look at his income and adjust his child-support obligation accordingly,

which he did not do. Therefore, based on Jeffrey’s income since the decree, he owed child-

support arrears of approximately $255,000. Jeffrey denied that the child-custody agreement

contained an escalation clause and argued that Heather’s request was an improper attempt to

obtain a child-support modification retroactively. He also argued that the doctrine of laches

prevented Heather from prevailing on her claim.

       The trial court found that the child-custody agreement did not contain an automatic

escalation clause. The court stated that the provision relied on by Heather to support her

claim of automatic escalation, taken in the context of the agreement, failed to unambiguously

determine an amount certain; failed to set a time for annual computation of support or an

effective date for any increase or decrease; failed to define which Arkansas Child Support

Chart should apply; failed to address what circumstances or needs of either Jeffrey or the

children should be considered in computing the amount; failed to define Jeffrey’s income or

how to compute it; and failed to define either a minimum or maximum support amount. As

a result, the trial court declined to order child support to be set retroactively. Finally, the

court indicated that the doctrine of laches barred Heather’s claim due to her failure to obtain

Jeffrey’s tax returns or engage him in an attempt to recompute the child-support amounts.2

Heather argues on direct appeal that the trial court erred in concluding that the decree and

child-custody agreement did not unambiguously provide for the automatic adjustment of

       2
       The court’s findings were initially expressed in a letter opinion filed August 17, 2016,
and were later reduced to an order entered on September 9, 2016.

                                              5
                                   Cite as 2017 Ark. App. 556

child support on an annual basis. She further argues that the doctrine of laches did not bar her

claim.

         We do not find Heather’s arguments persuasive for two reasons. First, the trial court

was not clearly erroneous in its finding that the child-custody agreement did not contain an

automatic-escalation clause. Admittedly, the child-custody agreement does state that child

support shall be computed annually and shall be commensurate with the Arkansas Child

Support Chart. However, it also states that the custodial parent reserves the right to seek

reevaluation of the amount of child support required to be paid by the noncustodial parent

in the event there was a material increase in income of more than $100 a month under the

material-change-of-circumstances provision of Arkansas Code Annotated section 9-14-107

(Repl. 2015). Such a consideration would not be necessary if modification was automatic.

Thus, it is not entirely clear from these provisions that the child-custody agreement

anticipated that modifications would be automatic.

         Second, the trial court was not clearly erroneous in its finding that the language of the

child-custody agreement was imprecise. We recognized the concept of automatic increases

of child support in Brandt v. Brandt, 103 Ark. App. 66, 286 S.W.3d 202 (2008), but we did

so only when the language in the decree clearly provided for automatic increases. We refused

to allow automatic escalation when a divorce decree contains no language providing for

automatic increases and no mechanism for gathering income information. Here, as noted by

the trial court, the decree did not set forth any guidelines for the reevaluation of child support.

                                                 6
                                  Cite as 2017 Ark. App. 556

It did not provide an annual date upon which support should be calculated, nor did it specify

how income was to be computed or which chart should be used.

       Because the trial court was correct in its determination that modification of child

support was not automatic, we need not address Heather’s argument regarding laches. The

trial court’s decision denying Heather’s claim for arrearages based on automatic escalation is

affirmed.

                                         II. Cross-Appeal

       Jeffrey has filed a cross-appeal, raising two points: first, the trial court erred in its order

directing an increase in child support; second, the trial court erred in its determination that

his payments into the trust fund constituted child-support payments, resulting in an award of

interest and attorney’s fees on the arrearages.

                                       A. Child-Support Increase

       The trial court entered an order modifying child support. The court calculated

Jeffrey’s child support for 2015 to be $2,835 a month based on his 2014 income. The court

calculated Jeffrey’s child support for 2016 to be $3,276 a month based on his 2015 income.

Because Jeffrey paid $5,625 in child support from April 2015 through December 2015 and

$2,500 from January 2016 through April 2016, the court found that he owed Heather $30,494

in arrears plus 10 percent interest on the arrears for that time period. Jeffrey argues on cross-

appeal that there was no evidence in the record on which to support the trial court’s

modification of child support from the date of the petition and that the trial court’s order

violated Administrative Order No. 10. He is correct. We have no evidence in the record

                                                  7
                                  Cite as 2017 Ark. App. 556

before us of Jeffrey’s 2015 income, which was the basis on which the court calculated the

2016 child-support obligation.3

       Our analysis of Jeffrey’s arguments begins with a review of the procedural history.

Heather filed a petition alleging that Jeffrey’s income had increased in an amount equal to or

more than twenty percent or more than $100 a month, thereby constituting a material change

in circumstances. She requested that the amount be modified to an amount commensurate

with his current income and Administrative Order No. 10. Jeffrey answered, admitting that

his child-support obligation should be modified. At the evidentiary hearing before the court,

the parties agreed to exchange financial information and calculate the amount and present it

to the court. The court asked, “So you’re going to offer me ‘15 tax returns and ask me to

calculate the amount of support?” Jeffrey’s counsel responded, “No, Your Honor, I think we

would actually do the calculation but I think we’re going to be in agreement. What we are

asking is that money be paid into the trust.” Despite this statement from Jeffrey’s counsel, the

parties did not honor the commitment to the court, and no calculations were presented.

       Administrative Order No. 10 requires child-support orders to contain the court’s

determination of the payor’s income, recite the amount of support required under the

guidelines, and recite whether the court deviated from the chart. Because there is absolutely

no evidence in the record on which the trial court could base its award of child support for

2016, this order is facially deficient. We are left with a definite and firm conviction that a

       3
        Although Jeffrey did not raise this argument below, it is still preserved for our appeal.
An appellant does not need to challenge the sufficiency in a bench trial in order to preserve
the issue for appeal. Bohannon v. Robinson, 2014 Ark. 458, at 5, 447 S.W.3d 585, 588.

                                               8
                                 Cite as 2017 Ark. App. 556

mistake has been made. As a result, we reverse and remand to the trial court with instructions

to complete the record with evidence of Jeffrey’s 2015 income and for entry of an order in

compliance with Administrative Order No. 10.4

                                  B. Trust-Fund Payments

       As stated earlier, the parties have a child, JPS, who has special needs. They agreed to

set up a trust for the benefit of JPS, with each party funding the trust with three percent of

their gross income. Heather filed an amended petition with the trial court alleging, in part,

that Jeffrey had failed to establish and fund the trust fund for JPS. Jeffrey answered, stating

that he had retained counsel to set up the trust fund and that he would fund the trust as

required by the child-custody agreement. Before the trial court, Jeffrey argued that his

payments into JPS’s trust fund should not be considered child support and subject to the

statutory imposition of attorney’s fees or interest on arrearages. He did, however, allege that

Heather had failed to establish or fund the trust for JPS and requested that she should be held

in contempt of court.

       With regard to the trust fund, the trial court made several rulings. The trial court

denied the contempt motion filed by Jeffrey but ordered the parties to establish a special-needs

trust for JPS and for the trust to be funded as set forth in the child-custody agreement. The

court ordered Heather to pay $12,903.20 into the trust and Jeffrey to pay $137,776.60 into

the trust to satisfy their past-due amounts, plus interest. The trial court then held that the

       4
        Arguably, Jeffrey invited the error that he raises on appeal by making commitments
to the court that were not honored. Nevertheless, Administrative Order No. 10 mandates
compliance not only for resolution of current child-support issues, but also for any future
modifications (increase or decrease) related to change of income.

                                               9
                                  Cite as 2017 Ark. App. 556

annual funds to the trust constituted child support and that interest on the past-due amounts

was mandatory under Arkansas Code Annotated section 9-14-201. The trial court further

found that Heather was entitled to an award of attorney’s fees. The court held that attorney’s

fees were mandatory pursuant to Arkansas Code Annotated section 9-14-233(b), calculating

the award based on the 2015 and 2016 support awarded and the amounts Jeffrey was ordered

to pay into the trust fund. Jeffrey argues that the trial court erred in determining that his

payments to the special-needs trust constituted child support (thereby requiring interest and

allowing attorney’s fees).

       We are left with a definite and firm conviction that the circuit court made a mistake

in its determination that the payments into the special-needs trust constituted child support.

Child support is ordered under the statutes to provide for the support and maintenance of a

child, including monetary support and health care. Ark. Code Ann. § 9-14-201(2). Here, the

trust is clearly set up for the support of JPS, who is a child of the parties, but this alone does

not make it “child support” as contemplated by the statutes. Statutorily, child support is paid

by the noncustodial parent to the custodial parent, and the court determines the amount of

child support after reference to the most recent revision of the family-support chart. Ark.

Code Ann. § 9-14-106. The supreme court has directed that child support is calculated from

the noncustodial parent’s gross income minus proper deductions. See Ark. Sup. Ct. Admin.

Order No. 10. Under the terms of the trust, however, both parents, custodial and

noncustodial, were to pay into the trust with the trust payments calculated based on a set

percentage of each of the parent’s gross income and not based on the child-support charts.

                                               10
                                 Cite as 2017 Ark. App. 556

       Moreover, utilizing our de novo review, it does not appear the parties considered the

trust payments as child support when they entered into the child-custody agreement. The

parties drafted an agreement with a section captioned “Support and Maintenance of

Children.” Under this caption, the parties agreed that “child support” should be calculated

and commensurate with the child-support charts. The provision establishing and funding the

trust, however, is not contained under this section specifying the support and maintenance of

the children and does not reference the child-support charts; instead, the trust agreement is

discussed in the section captioned “Debts, Insurance Obligations, and Medical Expenses of

Children” and is based solely on the gross income of the parties. Additionally, the agreement

further states that if JPS should predecease Heather and Jeffrey, the remainder of the trust

proceeds would be redistributed back to the parents—not a provision normally associated with

child-support payments.

       Because the trial court erred in its determination that the trust-fund payments

constituted child support, the trial court’s award of interest and attorney’s fees on those

amounts was likewise erroneous. Based on our determination that the trust-fund payments

do not constitute child support, Jeffrey’s argument that the trust-fund payments are a

deviation from the child-support charts requiring explanation under Administrative Order

No. 10 is moot. As for his arguments that he should be given credit for trust-fund payments

in calculating his child support and that the statute of limitations limits the amount that could

be awarded, he waived those issues because he did not raise these arguments below, and they

are not properly preserved for appeal.

                                               11
                                Cite as 2017 Ark. App. 556

       Affirmed on direct appeal; reversed and remanded on cross-appeal.

       ABRAMSON and GLADWIN, JJ., agree.

       Murphy, Thompson, Arnold, Skinner & Castleberry, by: A.F. “Tom” Thompson III and

Kenneth P. “Casey” Castleberry, for appellant.

       Rose Law Firm, a Professional Association, by: Amanda K. Wofford, for appellee.

                                             12