There were slim pickings today. The Ninth Circuit didn't publish anything at all -- for the second day in a row. The California Court of Appeal was silent in the morning. It looked like it might be a lazy, relaxing Wednesday.
Then this opinion came along.
One might write about this opinion just because it concerns the divorce case of a political figure -- Aliso Viejo City Council member Greg Ficke. A little (political) celebrity in the Court of Appeal.
But even beyond the "star" factor, it's a strongly-worded opinion. Which is far from surprising given its author, Justice Bedsworth. The Court of Appeal was not happy that the trial court imputed some income to the custodial mother. At all. So it reversed and remanded.
I can understand the Court of Appeal's holding. As well as its sentiment. We generally want -- or are at least fine with -- custodial parents spending some time at home with their children. For this reason we might generally be loathe to impute income to a nonworking parent. On the theory that we like it that they're not working. I get it.
At least as a general theory.
But that theory can nonetheless go too far.
Let me give you an example. Imagine that father and mother divorce, and there's a 17-year old child. Father gets 95% custody. Father generally makes a ton of money -- $500,000 a year -- as a CEO, but got laid off just before the divorce, so now just hangs out at home. Mother makes a relatively small amount of money -- $100,000 a year -- and busts her hump to do so. Father could easily take a job that pays $300,000 (i.e., triple what Mother makes), but doesn't feel like doing so.
Should Mother really have to pay support ("alimony") to Father? Or should we instead impute some income to Father, which would mean that Father either gets little (or no) support or instead has to pay something to Mother?
I think we should. Even if Father isn't just sitting on his butt, but is instead (1) playing catch with his 17-year old son, and (2) earning $60 a week -- rather than the $6,000 a week he could make -- since he took a job as a part-time baseball coach so he could "be there" for his son.
Yes, we value hanging out with your kids. But not exclusively. It's not fair to the $100,000/year Mother to make her pay $300,000+/year Father alimony. Imputation would instead be proper.
The facts I just mentioned are fictional. But they demonstrate the point.
They're also not too far off from the facts of this case.
I admittedly deliberately switched genders. Here, Mother obtained 95% custody. But she's also the high earner. She was a VP at a dental implant manufacturer. Her 2007 W-2 showed over $725,000 (!) in income. She got over $200,000 in severance when she was terminated in 2008. But despite the fact that she could very easily get another six-figure job, she instead decided to start a "pet insurance" business similar to her mother's business in Arizona. A job that nets her only $250 a month.
Father, meanwhile, is a real estate broker and City Council member. He makes less than $100,000 a year.
The only other difference between the hypothetical and the actual facts of this case is that there are in reality two kids instead of one: a 16-year old and a 17-year old.
The trial court made Father pay child support to Mother. But the trial court also made Mother pay support ("alimony") to Father because it imputed $160,000 of income -- the amount that it thought $700,000+ Mother could easily make -- to Mother, which meant that she made more than him.
That latter ruling was what made the Court of Appeal go quasi-ballistic, and reverse.
I'd be somewhat sympathetic to this ruling, to be honest, if the kids were younger. If there's a two-year old kid who needs full-time support, I'm hesitant to impute income to the custodial parent, as it may well effectively coerce that parent to enter the workplace and leave the child. I get that. I could see refusing imputation in such a situation.
But here, it's different. We're dealing with kids in high school. Late high school, at that. The stark reality is that while those kids definitely need support (and rearing) as well, it's not nearly a full-time job. The need to "be there" for those kids 24/7 by opting out of the workforce simply doesn't exist. Or if it does, someone needs to tell that to the millions of two-earner couples and single parents out there who nonetheless manage to raise their kids -- well -- without a full-time stay at home parent.
In short, you can raise your high-school kid just fine even if you work. Yes, there's some value in a parent being home at 3:30 p.m., rather than 5:30 p.m., so they can hand the keys to the kid (who can already drive) to go with their friends and do their extracurriculars, and -- on those exceptionally rare occasions when the teenager desires it -- play catch with them in the backyard. I'm not denying that those things are good and valuable.
But to say that they're so essential that we should categorically impute no income to the custodial parent just seems wrong. It seems more case-by-case to me. For a young child with a mother who stays at home and could otherwise make only $35,000 at work, yeah, I'm on board for imputing no income. For a 17-year old with a parent who could make $200,000 or $750,000, uh, no, I'm pretty much just fine with imputing income.
The Court of Appeal adds a caveat, but I don't think it has any substantial practical effect. It limits its holding by saying that a trial court can sometimes impute income when imputation would benefit the child (i.e., be in their best interests). But let's be real. That will never be the case. It will never help the child to reduce the amount of money their custodial parent receives. Just doesn't happen.
Let me make a suggestion. Something I think would make the Court of Appeal's opinion better, and yet be consistent with its overall theme -- as well the overriding thrust of family law.
Rather than saying (as the Court of Appeal does) that a trial court can't impute income unless it's affirmatively in the best interests of the child, I think it makes much more sense to say that you can only impute income when it doesn't conflict with the best interests of the children. In some cases -- as with the young child (and, potentially, even with older children), imputation might be a bad idea, and harm the kids. If it meant that kids were routinely left alone on nights and weekends, then, sure, no imputation. I'm on board for that.
By contrast, if imputing income meant that, on an occasional evening, when the custodial parent had to work late, the kids would have to be picked up (or stay with) a noncustodial parent who was more than happy to spend time with them, well, you know, that seems totally fine with me. Permitting the could-easily-be-richer parent to obtain funds from the poorer parent when such a consequences is not affirmatively justified by the best interests of the child seems wrong. If the kids will be totally fine with imputation or without, then it seems like it makes sense to me to go ahead and impute.
Parenthetically, that also seems precisely the case here. Mother's rich. She can make a ton of money whenever she wants, and also received over a million bucks in the divorce. Father's rich too, and he's got the million bucks he got in the divorce plus another million or so in separate property. Father has to pay child support to Mother as well.
The stark reality is that these O.C. teenagers are going to do just fine regardless of whether their could-be richer parent has a fraction of the income she used to make imputed to her for purposes of calculating support. The parents have a million bucks each to blow on their kids during the year or two of child support left, and even thereafter, I've got no doubt whatsoever that giving the poorer parent $700 a month in support (i.e., a whopping $8,400 a year) -- which is what the trial court did here -- will not matter one iota to the kids. Mother's not going to do anything different, Father's not going to do anything different, and the kids won't notice the transfer in the slightest.
As a result, on Shaun's Modified Rule, since imputing income won't be inconsistent with the best interests of the children, absent other countervailing considerations, that's what one should do. It's what we do in every other support context, and it's fair.
Oh, and parenthetically, my proposed modification of the Court of Appeal's holding is also consistent with the actual statute. Section 4058 of the Family Code says that a court's determination of earning capacity must be "consistent with the best interests of the children." Notice that it says "consistent with," not "advance". My rule says that imputation is permitted if it's "consistent with" the interests of the children. The Court of Appeal's rule says that imputation is permitted only if it advances the interests of the children (e.g., "no imputation of income should be made to the custodial parent unless it benefited the children"). Which of these seems more consistent with the statutory text?
In short, I'm on board for a lot of what the Court of Appeals says. In particular contexts. But not as a uniform rule, and not in each and every case. And as for the rule itself, I think that one that's slightly different than the one articulated by the Court of Appeal would be superior. Not only as a general principle, but also -- at least potentially -- as applied to the present case.
