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Arizona Law on a Deviation in Child Support
Mrs. Nia (“Mother”) appealed the decision of the Maricopa County Superior Court (“lower court”) order modifying Mr. Nia’s (“Father”) child support obligation for the parties’ three (3) common triplet daughters, now adults.
The parties’ further stipulated to Father paying an upward deviation in child support amount of $3,830 per month, initially based on a historical disparity of income favoring Father.
In 2012, Father filed a petition to modify child support, leading to another stipulated agreement between the parties’ modifying the child support amount downward to the sum of $3,500 per month, instead of the $1,100 per the Arizona Child Support Guidelines (“Guidelines”), despite Father’s 2012 gross monthly income of $54,852 per month and Mother’s income at $13,694 per month.
In June 2015, Father filed a second petition to modify child support from $3,500 per month, downward to $406.94 per month, as per the Arizona Child Support Guidelines.
The evidence produced at this hearing reflected that Father’s present gross monthly income (in 2015) was $32,783 per month and Mother’s was now $22,489 per month.
After a hearing, the lower court concluded Father had shown a substantial and continuing change of circumstances warranting a review of the child support order.
It was determined by the lower court, that pursuant to the Guidelines, Father was obligated to pay $623.84 per month in child support, starting October 1, 2015. The lower court also determined a deviation from the Guidelines was not appropriate under these circumstances.
Father timely filed a Motion to Correct Mistake arguing the order for child support should be effective from the first of the month following the date of service of his petition to modify.
The lower court issued an amended final order with child support modification effective July 1, 2015. The lower court, based on Father’s objection, denied Mother’s request to have her witness on finances be present in the courtroom during Father’s testimony. Mother timely appealed.
Appeal Over a Requested Child Support Deviation
In Arizona, the “decision to modify an award of child support rests within the sound discretion of the trial court and, absent an abuse of that discretion, will not be disturbed on appeal. Little v. Little, 193 Ariz. 518, 520, ¶ 5 (1999). The Appellate Court will also accept a lower court’s finding regarding facts unless they are “clearly erroneous”, but “will draw its own legal conclusions from facts found or implied in the judgment”. Nash v. Nash, 232 Ariz. 473, 476, ¶ 5 App. 2013).
Mother has raised five (5) legal arguments to support her claim for reversal, which include the following:
1. finding a substantial and continuing change of circumstance existed to justify a modification of the 2012 Order; and
2. applying the child support Guidelines without considering the parties’ previous agreements for a deviation; and
3. determining that Mother had the burden to prove an upward deviation was in the Children’s best interest; and
4. applying the child support modification retroactively without order, Mother be reimbursed for expenses paid pursuant to the 2012 Order; and
5. the exclusion of Mother’s expert witness from the courtroom during Father’s testimony.
Appeal Regarding Substantial and Continuing Change in Circumstances
The mother initially claims the lower court erred in finding a substantial and continuing change of circumstances existed to justify modification of child support paid by Father; and by failing to ‘consider the best interests of the minor children in determining a change in circumstances.’
However, Arizona law requires that a child support order can only be modified ‘on a showing of changed circumstances that are substantial and continuing.’ See Arizona Revised Statute (A.R.S.) § 25-327(A); [also citing Guidelines § 24(A), “[E]ither parent …may ask the court to modify a child support order upon a showing of a substantial and continuing change of circumstances”.
The reviewing court found that the lower court retains the sound discretion to determine whether changed circumstances exist to warrant modification of an award. Whether such a change occurred is a question of fact, allowing the lower court to retain ‘the sound discretion’ to determine whether changed circumstances exist to warrant modification of an award, and the Guidelines do not replace the exercise of the trial court discretion; they focus it.
In this case, the lower court reviewed and considered several circumstances that would be appropriate to modify the 2012 support Order, including Father’s decreased income and Mother’s increase in income, as well as, Mother’s claim that Father’s alleged business expenses were ‘de minimus’ and reimbursements of said expenses was not counted toward income.
Mother also claims, Father’s income remains above the $20,000 maximum set forth in the Guidelines for calculating child support and therefore, it has not ‘substantially and continually’ changed.
However, the court reviewed the parties 2013 and 2014 tax returns, finding that Father’s income had decreased from $441,636 in 2013 to $382,383 in 2014, because of a reduction in new dental clients, supporting the lower court’s decision that there was a substantial and continuing change in circumstances. Finally, the court decided that the business expenses were not ‘significant’, nor did the payments and reimbursements for said business expenses reduce Father’s living expenses, and Father had not ‘sheltered’ his income.
Mother’s income also increased from $241,421 in 2013 to $271,457 in 2014, and she reported income of $225,200 for the first eight months of 2015, reducing the monthly income gap from $41,158 in 2012 to $10,294 in 2015, which Mother did not dispute. Therefore, the reviewing Court found no abuse of discretion in the lower court finding of substantial and continuing change of circumstances to warrant modification of Father’s child support obligation.
Request for Upward Deviation in Child Support
Mother argued the lower court erred by ordering a Guideline support amount be paid by Father because she believed the evidence demonstrated an upward deviation was appropriate and just. Mother also claims error because the lower court failed to consider its own findings underlying the 2012 Order, and its upward deviation of the child support amount therein.
In Arizona, parents may be ordered to ‘pay an amount reasonable and necessary for support’ of the children’s ‘reasonable needs’. A.R.S. § 25-320(A). Moreover, if the amount calculated under the Guidelines is adequate under the circumstances, the lower court need not consider a deviation allowed by the Guidelines.
However, A.R.S. § 25-320 requires the lower court to follow the Guidelines and consider factors of A.R.S. § 25-320(D) only if it intends to deviate from the Guidelines. The lower court found the income of each parent to be significant and substantially similar. The court determined that the children’s ‘reasonable needs’ were being adequately met without any additional financial assistance (i.e. upward deviation) being granted.
This court also found that the children enjoy a very comfortable lifestyle…that will continue unabated’ with Father’s payments based on the Guideline amount, without any upward deviation being needed. There is no evidence of any special needs of the children, no extraordinary education or any extraordinary medical expenses that would require a deviation.
However, the record supports Father’s position by showing he purchased clothes, meals, provided spending money and took the children on vacations. The Court found that both parents incurred similar expenses for the children and that Father paid one-half of the extracurricular activities for the children in the past.
The reviewing court relied on A.R.S. § 25-503(E) to show that, “[A]n order of child-support ‘modification… [is] effective on the first day of the month following notice of the petition for modification”. Father served his petition for modification on June 11, 2015. The lower court ordered the child support modification to begin on July 1, 2015. The reviewing court found no error had occurred and the new support order would begin July 1, 2015.
No Presumption for an Upward Deviation in Child Support
The Appellate Court ruled that once the superior court determines there is a substantial and continuing change of circumstances, the lower court must apply the Arizona Child Support Guidelines, and then decide whether to deviate from that amount calculated pursuant to the Guidelines. The court also ruled that there is not a presumption for deviation based on a previously deviated order.
Moreover, if the lower court finds that the application of the Guidelines would be inappropriate or unjust, it must make findings as to all relevant factors set forth in A.R.S. § 25-320(D). Finally, the court ruled that to deviate from the amount calculated pursuant to the Guidelines, the court must determine both the deviation is appropriate and that it is in the best interest of the children. The Court of Appeals affirmed the holdings of the lower court in this case.
The Standard of Proof for Child Support Deviation in Arizona: Nash vs. Nash
In the case of Nash v. Nash (yes, that Nash of your Phoenix Suns), 232 Ariz. 473, 307 P.3d 40 (2013), Mother appealed a child support order entered in conjunction with a divorce proceeding of two wealthy persons. The Arizona Court of Appeals, Division 1, held that the superior court in such a case may not limit child support to an amount required to meet the children’s minimal needs.
To the contrary, child support should permit the children of such a marriage to continue to enjoy the reasonable benefits they had while their parents were married. The Court of Appeals also addressed two post-decree orders also at issue on appeal, and affirmed an order prohibiting the parents from posting disparaging remarks on social media, but vacated an order barring the parents from disclosing any document or information in any document filed in the proceeding. Neither party had a slam dunk with this one.
The Nash’s married in 2005. After presumably many foul calls, Father filed for dissolution in 2010. The parties had an infant son and two six-year-old daughters. Although the parties resolved issues of custody and parenting time by agreement, they could not agree on child support, and the superior court held a one-day trial on the issue.
The parties jointly asked the court to close the trial to the public, and it did so. Shortly after the court issued its judgment and decree, it reiterated a prior order that sealed all proceedings and ordered that “[d]ocuments, records, and transcripts sealed by the Court, and information contained in the sealed material, may not be disseminated to any third party without an Order of the Court.”
The court also affirmed a parenting coordinator’s report that rebuked Mother for “tweeting” a negative remark about Father and declared that she “must stop” using social media to disparage him. Mother, clearly with itchy Twitter fingers, timely tweeted out her appeal.
The Arizona Child Support Guidelines
The Court of Appeals will not disrupt an award for child support absent an abuse of discretion at the superior court level. Pursuant to A.R.S. § 25–320(A), the superior court “may order either or both parents owing a duty of support to a child … to pay an amount reasonable and necessary for the support of the child.” In subpart (D) of the same statute, the legislature directed the supreme court to “establish guidelines for determining the amount of child support.”
The result is the Arizona Child Support Guidelines. The amount resulting from the application of the guidelines is the amount of child support ordered unless a written finding is made that application of the guidelines would be inappropriate or unjust in a particular case, such that some type of deviation would be appropriate. The Guidelines establish a framework for determining the amount of child support consistent with the reasonable needs of children and the ability of parents to pay.
The premise of the Guidelines is the Income Shares Model, which is based on two principles: (1) The total child support amount approximates the amount that would have been spent on the children if the parents and children were living together, and (2) Each parent contributes his/her proportionate share of the total child support amount.
Attached to the Guidelines is a “Schedule of Basic Support Obligation,” which sets out presumptive amounts of child support, called the “Basic Child Support Obligation,” derived from the parents’ combined gross incomes. As the parents’ combined gross income increases, so does the presumptive Basic Child Support Obligation.
The highest combined income in the Schedule is $20,000 per month. If the parents’ combined gross income exceeds $20,000 per month, the presumptive Basic Child Support Obligation is that identified for a combined income of $20,000 per month.
A parent may request an “upward deviation” from the presumptive Basic Child Support Obligation by showing that a higher amount is in the best interests of the child. As was applicable here, after determining the Basic Child Support Obligation from the Schedule, the superior court then must add to that figure “the cost of the children’s medical, dental and/or vision insurance coverage, if any” and also may add childcare costs “appropriate to the parents’ financial abilities” and “reasonable and necessary” education expenses “when such expenses are incurred by agreement of both parents or ordered by the court.”
Except in the event of a court-ordered deviation, the resulting sum is the “Total Child Support Obligation,” for which the parents share responsibility in proportion to their respective gross incomes.
Pursuant to the schedule, when, as here, the parents’ combined monthly gross income is $20,000 a month or more, the Basic Child Support Obligation for three children is $2,795. As noted above, to this amount, the court must add certain medical and dental expenses (and may add childcare and education expenses) to derive the Total Child Support Obligation.
The decree entered by the superior court acknowledged the children’s monthly medical and dental insurance expenses of $1,314 and education expenses of $1,750, and, according to the record, monthly childcare expenses were $2,000. But the record does not show that the court added those amounts to the Basic Child Support Obligation, as the Guidelines require.
The child support worksheet the court completed did not take into account any of those expenses. Instead, the worksheet endorsed the presumptive Basic Child Support Obligation amount of $2,795 as the Total Child Support Obligation without recognizing any insurance, education and/or childcare expenses.
The Guidelines also require the court to divide the Total Child Support Obligation between the two parents based on their proportionate gross monthly incomes. Although the superior court imputed to Mother a specific income in excess of $20,000 a month, it did not determine Father’s monthly gross income; as a result, it could not and did not determine the proportionate relationship between the parties’ respective gross incomes.
Without making a finding of each parent’s income and then allocating the Total Child Support Obligation in proportion to their respective incomes, as the Guidelines instruct, the decree ordered Father to continue to pay the children’s medical and dental insurance expenses and their educational expenses.
The decree then continued: Father and Mother will divide “all reasonable and necessary non-covered health-related expenses for the children,” 90%/10%; Father and Mother will divide “all mutually agreed-upon extra-curricular activities for the children,” 90%/10%; Father and Mother will divide the parenting coordinator’s fees, 75%/25%; and “As to all other costs and expenses divisible between the parties not specifically addressed herein, [Father] shall pay 72% and [Mother] shall pay 18%.”
The decree did not clarify the nature of the “other costs and expenses divisible between the parties” to which the final provision above applies, and at oral argument before the Court of Appeals, neither party expressed a clear understanding of the meaning of the provision. The parties did agree, however, that beyond the responsibility for insurance, education, health-care and parenting-coordinator expenses recited above, the decree imposes no child-support obligations on Father.
Although Mother also took issue with the superior court’s rejection of her request for an upward deviation in child support, she argued the court erred in the first instance by failing to follow the analytical process set out in the Guidelines. Mother contended the court erred by failing to determine whether childcare costs should be added to the Basic Child Support Obligation in calculating the Total Child Support Obligation, by failing to determine Father’s monthly gross income, and then by failing to allocate the Total Child Support Obligation between the parties in proportion to their monthly gross incomes.
Mother further argued the record did not demonstrate that the superior court followed the analytical process dictated by the Guidelines, and to the extent the court failed to follow that process, it erred. Father contended that at the end of the day, the court did not abuse its discretion in making the payment orders contained in the decree.
It may be that the court would have come to roughly the same conclusions had it engaged in the analysis the Guidelines require it to perform. On this record, however, the Court of Appeals could not discern whether that was so.
Therefore, on remand, after considering whether an upward deviation in Total Child Support Obligation is required, and determining what insurance, education and childcare expenses should be added to the Basic Child Support Obligation pursuant to Guidelines, the superior court then should determine Father’s gross monthly income and allocate the Total Child Support Obligation between the parties in proportion to their gross incomes. After performing that division, the court may order the parties to make specific child-support payments consistent with the outcome of its analysis.
Mother further argued the superior court also erred by failing to grant an upward deviation in child support. The Guidelines provide that a parent seeking more than the presumptive child-support amount derived from the Guidelines and the child support schedule shall bear the burden of proof to establish that a higher amount is in the best interests of the children.
The superior court has broad latitude to fashion an appropriate award of child support, and the Court of Appeals will uphold the award unless it is “devoid of competent evidence.” At trial before the superior court, Mother called to testify a certified public accountant, who testified that based on the family’s historical expenditures, Mother was entitled to receive $22,500 in monthly child support. On appeal, Mother argued the superior court erred by holding that because she failed to prove she is entitled to that precise amount of child support, she was entitled to no upward deviation of any amount.
She pointed to a footnote in the decree stating: The Court determines that it is not up to the Court to correct, re-calculate, or otherwise adjust the amount sought in the upward deviation. By statute, the burden of establishing the need for the deviation is on the party seeking the deviation.
Thus, if the amount sought is incorrect, it is for the proffering party to correct not the Court. As the decree stated, Mother had the burden to prove that her request for a higher amount of child support was in the children’s best interests. Contrary to the statement in the footnote, however, nothing in the Guidelines or other law provides that a parent who does not prove every penny of a specific requested amount of upward deviation is entitled to no deviation whatsoever.
Instead, in asking the court to establish a child support amount in excess of the amount derived from the child support schedule, Mother only had to prove that some upward deviation was in the best interests of the children.
For its part, as the trier of fact, the superior court shall grant whatever amount of upward deviation it finds is supported by the evidence under the applicable legal principles. Although Father argued that notwithstanding the footnote, the superior court went on to conclude that Mother failed to prove any amount of upward deviation was appropriate, the decree did not so state.
To the contrary, the decree supported Mother’s assertion that, consistent with the footnote, the court denied any upward deviation because it found she had not proved that the best interests of the children required the specific amount of upward deviation she sought.
For example, in analyzing the key factor under the Guidelines of “the needs of the children in excess of the presumptive amount,” the decree concluded “[t]he Court did not find that [Mother] established a need by the children to receive $22,500 in excess of the presumptive amount.”
Later, the decree states, “THE COURT FINDS that [Mother] has not demonstrated that a child support amount of $22,500 is necessary or in the best interest of the children.” Because the Court of Appeals could not determine that the superior court gave due consideration to Mother’s request for an upward deviation in child support, it vacated the decree’s treatment of that issue and remanded for further proceedings consistent with the reasoning set forth above.
Although the superior court concluded that the accountant’s qualifications and testimony did not satisfy Arizona Rule of Evidence 702 which sets forth who can qualify as an expert witness in the trial, it nevertheless considered the testimony, but ultimately declined to accept his opinions because it found they were “neither reliable nor correct.”
Mother argued the superior court erred in ruling that the accountant was not qualified. She argued he has testified “hundreds of times in courts in several states, using the same type of information he used here.” Setting aside whether the accountant qualified as an expert witness pursuant to Rule 702, the Court of Appeals found the superior court did not abuse its discretion in declining to accept his analysis. Without recounting the particulars, numerous analytical flaws revealed during his cross-examination support the court’s decision to reject his testimony.
The First-World Problems Deviation
While considering Mother’s request for an upward deviation in child support pursuant to § 8 of the Arizona Child Support Guidelines, the superior court heard testimony by Mother and Father relating to “the standard of living the children would have enjoyed if the parents and children were living together [and] the needs of the children in excess of the presumptive amount.”
On appeal, Mother argued the court erred because it considered only whether the presumptive child-support amount was sufficient to satisfy the children’s “basic needs.” She pointed to the conclusion in the decree that, given both parents’ resources, “the basic needs of the children will be more than adequately met without an upward deviation.” As Mother argued, in explaining its analysis, the superior court described this factor as to whether “additional money is needed to provide for the basic standard of living for the minor children.”
Under the certain circumstances presented here, to the extent the court rejected an upward deviation in child support because it concluded the presumptive amount satisfied the children’s basic needs, it erred.
In determining child support, the superior court must consider the reasonable needs of the children in light of the parents’ resources. In determining whether an upward deviation in child support is appropriate in a case such as this, the court must give considerable regard to the reasonable benefits, beyond their “basic needs,” accorded to the children during the marriage.
Even though the superior court, in this case, rejected the opinions of Mother’s expert witness, it received considerable other evidence of the expenses of the parents’ respective households in Arizona and elsewhere. Both parties agreed they wanted to continue to expose their children to diverse cultures and cultural events.
While travel expenses were a point of contention, Father did not dispute that the children should continue to enjoy regular extensive international travel, including regular visits with their maternal relatives in South America and Australia; and other travel, including ski vacations; the dispute was only about the nature and style of that travel.
Although the family may have spared few expenses in the manner in which it traveled during the marriage, Mother testified that coach airplane tickets to South America are $1,500 apiece. The superior court seemed to accept that the children should be able to continue to travel extensively, noting “the Court understood Father’s objection to being the manner of travel … not the destination.”
In spite of this finding and the other evidence in the record, however, the court apparently did not consider the family’s demonstrated travel, entertainment and housing expenses in determining whether to grant an upward deviation in child support.
Expenses associated with international travel and households such as those of these parties in this case usually are not relevant to the child-support needs of children in the majority of Arizona households. But in deciding child support after the dissolution of marriages such as this one, involving significant wealth, the superior court must consider the expense of allowing children who have enjoyed such benefits to continue to receive them after the dissolution.
In declining to grant Mother’s request for an upward deviation, the superior court stated it accepted Father’s contention that “overindulging the children is not in their best interest.” The Court of Appeals did not mean to say that the court must provide child support that matches historical spending patterns, dollar-for-dollar.
Because the touchstone always is the best interests of the child, a child’s share in the good fortune of his or her parents must be subject to the limitation that the award is “consistent with an appropriate lifestyle.” Under circumstances such as these, the court may conclude that the pre-dissolution lifestyle of the children need not be precisely replicated, particularly when, as here, one parent persuasively argues in favor of more modest conditions.
Finally, the superior court may not avoid this analysis by simply concluding that the parent seeking the upward deviation has sufficient resources by herself to provide the children the lifestyle they enjoyed during the marriage. The issue is not whether the parent who seeks the upward deviation can afford to provide the children with their pre-dissolution lifestyle without assistance from the other.
Particularly the unusual circumstances present here, when Father’s income and wealth may significantly exceed Mother’s, the court may not fail to perform the analysis the Guidelines require. The Court of Appeals, therefore, vacated the provisions related to the child support order.
If you have questions about child support deviation in an Arizona divorce case, you should seriously consider contacting the attorneys at Hildebrand Law, PC. Our Arizona child support and family law attorneys have over 100 years of combined experience successfully representing clients in child support and family law cases.
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