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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Shepherd v. Haralovich (10/26/2007) sp-6181

Shepherd v. Haralovich (10/26/2007) sp-6181, 170 P3d 643

     Notice:   This opinion is subject to correction  before
     publication  in  the  Pacific  Reporter.   Readers  are
     requested to bring errors to the attention of the Clerk
     of  the  Appellate  Courts, 303  K  Street,  Anchorage,
     Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
     e-mail corrections@appellate.courts.state.ak.us.


            THE SUPREME COURT OF THE STATE OF ALASKA

BARBARA SHEPHERD, )
) Supreme Court No. S- 11692
Appellant, )
) Superior Court No.
v. ) 1JU-02-00025 CI
)
GEORGE HARALOVICH, ) O P I N I O N
)
Appellee. ) No. 6181 - October 26, 2007
)

          Appeal  from the Superior Court of the  State
          of  Alaska, First Judicial District,  Juneau,
          Patricia A. Collins, Judge.

          Appearances:  James E. Curtain,  Juneau,  and
          Vance  A.  Sanders, Law Office  of  Vance  A.
          Sanders, LLC, Juneau, for Appellant.   George
          J. Haralovich, pro se, Juneau.

          Before:   Bryner,  Chief  Justice,  Matthews,
          Eastaugh, Fabe, and Carpeneti, Justices.

          PER CURIAM.
          EASTAUGH,   Justice,  with  whom   CARPENETI,
          Justice, joins, dissenting in part.


I.   INTRODUCTION
          Alleging  that  her income had declined  following  her
divorce  from  George  Haralovich,  Barbara  Shepherd  asked  the
superior  court  to recalculate child support.  Shepherds  income
had declined in part because she had sold rent-producing property
that  she  had  been awarded in the divorce.  The superior  court
found  that Shepherds income was effectively the same as  before.
When   Shepherd  moved  for  reconsideration,  the  trial   court
considered  that  income Shepherd could realize from  reinvesting
net  proceeds from the rental property sale would compensate  for
the  small  decline in her net income and denied reconsideration.
Shepherd  appeals the denial of her reconsideration  motion  and,
among  other  things, argues that because she was not voluntarily
underemployed,  it  was error to impute any income  to  her.   We
affirm   the  courts  imputation  of  investment  income  because
imputation  does not require underemployment.  But we remand  the
matter  to the superior court to determine Shepherds federal  tax
liability  and recalculate her adjusted annual income to  account
for that tax liability.
II.  FACTS AND PROCEEDINGS
          Barbara Shepherd and George Haralovich divorced in 2002
after  a  marriage  of  seventeen years.   Shepherd  was  awarded
primary  physical  custody of the parties  three  children.   The
divorce  decree set Haralovichs base child support obligation  at
$1,654 per month.  As part of the divorce, Shepherd received  the
family home and also received a rental property estimated in 2002
to  be worth $235,000.  The rental property carried two mortgages
totaling  about $110,000.  Shepherd sold the rental property  for
$265,000 in 2003.
          In July 2003 the oldest child moved away from home.  In
December  the  court  issued  a new custody  order  for  the  two
children still at home which set out a week on/week off schedule.
In April 2004 the superior court issued a new child support order
ending Haralovichs child support obligation for the oldest  child
and  also  changing the custody arrangement for the two remaining
children.   Child  support was based on  one  child  living  week
on/week  off  with  both parents, while the other  child  resided
primarily with Shepherd.
          The  April 2004 order also noted that Shepherds January
2004  child support affidavit reflected less income than her 2002
affidavit, partly because she did not list any rental  income  in
2004.   Shepherds 2002 affidavit had listed her gross  income  as
including $50,000 in wages, $21,288 in rental income, and  $2,050
from  other sources.  The April 2004 order stated that the  court
would  rely on Shepherds 2002 affidavit in calculating income  to
compute  child  support  unless Shepherd  submitted  supplemental
information,  including her full 2003 federal  tax  return,  that
explained   her  decreased  income.   Based  on  Shepherds   2002
affidavit,  in  April  2004 the superior  court  determined  that
Shepherds net income was $51,639 after allowable deductions.
          In response to the April 2004 order, Shepherd submitted
an affidavit explaining that she had sold the rental property and
declaring  that my income from rentals has gone from  $21,288  to
zero.  She did not submit a tax return or equivalent documents.
          In  July  2004 the superior court issued another  order
regarding child support.  The court used a January 2004 pay  stub
to estimate Shepherds net income at $44,126; this was $7,513 less
than  the amount set out in the April order.  The $44,126  figure
did not include any income from rental property or any investment
income  from funds generated by the sale of the rental  property.
The  superior court declared that [w]hile Ms. Shepherd  indicates
that  she  sold her income-producing property, the court  assumes
that  she could have continued to receive that income and/or that
she  re-invested those funds in such a way that  is  as  or  more
financially  advantageous  as  was  previously  the  case.    The
superior court in its July order thus seemed to impute $7,513  in
investment  income  to  Shepherd.  The court  indicated  that  in
calculating child support it would use an adjusted annual  income
figure  of  $51,639 for Shepherd.  The superior court noted  that
Shepherd had still not submitted her 2003 federal tax return  and
all  attachments or any explanation under oath as to  the  amount
and disposition of the proceeds of the income-producing property.
The  court  announced that barring a request for  reconsideration
and  submission  of that information, it would  issue  a  support
order based on the prior calculation.
          Shepherd  then moved for reconsideration and  submitted
her  affidavit attaching her 2002 and 2003 federal  tax  returns.
Her  2003  tax return reflected a taxable wage income of  $44,421
and  a $95,393 capital gain from the sale of the rental property.
She  stated  in  her affidavit that the rental property  was  not
producing  enough income to justify [her] holding  it  long-term.
She  also  stated  that the sale was made  necessary  by  a  poor
financial position partially caused by Haralovichs failure to pay
child  support.   She  asserted that she did  not  re-invest  any
proceeds  of the sale in a way that would provide her  a  regular
income.
          In  September  2004 the superior court issued  a  third
order, addressing Shepherds reconsideration motion.  Based on the
financial  information  newly  submitted  by  Shepherd  with  her
reconsideration  motion,  the  superior  court   calculated   her
adjusted net annual income at $50,730.  The superior court  noted
that  this  figure  was only $909 less than  the  net  income  of
$51,639 it had used in the two prior orders.  The superior  court
denied  Shepherds  motion for reconsideration; it  reasoned  that
although  her  annual wages were $909 less  than  the  court  had
previously assumed (excluding the $95,000 capital gain1),  it  is
reasonable  to assume that at least some portion of the  proceeds
of  the  sale of the rental property would be invested in such  a
way  as  to  net  at  least $909 per year.   The  superior  court
therefore  concluded that [t]he $51,639 net annual income  listed
in  Shepherds  2002 Civil Rule 90.3 affidavit appears  to  be  at
least  that income that best reflects [Shepherds] current  income
and/or income producing ability.
           Shepherd appeals from the September order denying  her
reconsideration motion.
III. STANDARD OF REVIEW
          We  review  a  trial  courts denial  of  a  motion  for
reconsideration for abuse of discretion.2  We review decisions to
impute  income for abuse of discretion.3  Whether a  trial  court
has  abused its discretion depends on whether we are left with  a
definite  and firm conviction, after reviewing the whole  record,
that  the  trial court erred in its ruling.4  But  [w]hether  the
trial  court used the correct method of calculating child support
is  a  matter of law, therefore we give no deference to the trial
courts  decision.5   We  apply  our  independent  judgment   when
reviewing  a  lower courts interpretation of statutes  and  other
          related legal questions.6
IV.  DISCUSSION
     A.   The  Superior  Court Did Not Abuse  Its  Discretion  by
          Considering  the Income-Producing Capability  of  Funds
          from the Sale of the Rental Property.
          
          Shepherd  argues  that  the  superior  court  erred  by
imputing income to her and that income may only be imputed  to  a
parent   who  voluntarily  and  unreasonably  is  unemployed   or
underemployed.  7  Shepherd argues that as a matter  of  law  the
trial   court   must  make  a  determination  of  voluntary   and
unreasonable  unemployment  or  underemployment  before  imputing
income.
          We  first  observe that there is some question  whether
the  superior courts final order denying reconsideration,  issued
in  September,  actually imputed any income  to  Shepherd.   This
uncertainty may stem from the three orders issued by the superior
court.   The  April order imputed no income to Shepherd  and  was
based  on  Shepherds  earlier statement  that  she  had  received
approximately $21,000 in rental income.  The July order may  have
imputed  income of about $7,500 to Shepherd, but that  order  was
superseded by the September order issued after Shepherd moved for
reconsideration.   Shepherd appeals the September  order  denying
reconsideration.
          In  its April 2004 order, the superior court relied  on
Shepherds  2002 child support affidavit and provided  that  child
support  would  be  based  on her net  income  of  $51,639.   The
superior  court  denied reconsideration in  its  September  order
because  it found that Shepherds financial information  indicated
her  current income was $50,730.  Therefore, the superior  courts
final  order  imputed,  at  most, $909 of  investment  income  to
Shepherd, the difference between $50,730 and the $51,639 referred
to in the April 2004 order.
          It  is  probable,  however, that  the  superior  courts
consideration of potential investment income is not an imputation
at  all.   If imputation is appropriate, a court typically  finds
the  specific  income to be imputed to the parent and  uses  this
figure  to  calculate  child support.8  The superior  court  here
simply  looked to the earning power of at least some  portion  of
the  proceeds  from the rental property sale,  and  assumed  they
would  net at least $909 per year, in order to confirm that there
was no significant difference between the income figure the court
had  used  in  its July order and the income figure described  in
Shepherds reconsideration motion.
          This  was an appropriate way for the superior court  to
decide  whether  to  grant Shepherds motion for  reconsideration.
There  was a difference of only $909 between the prior net income
figure   and   the  net  income  figure  revealed  in   Shepherds
reconsideration affidavit.  Shepherds 2003 tax return listed  the
gross sales price of the rental property as $265,000.  Given that
the  court had previously been informed that there were  existing
mortgages  of  approximately $110,000 on  the  property,  it  was
reasonable to think that some net proceeds from the sale  of  the
property   could  have  been  safely  reinvested  and  that   the
investment  income would more than compensate for the  relatively
          small difference in net income.
          The   superior  court  therefore  did  not  abuse   its
discretion in concluding in September that the $51,639 net income
figure  the court used in the April and July orders to  calculate
child   support  reflects  [her]  current  income  and/or  income
producing  ability.  The court did not use the net  of  the  sale
proceeds  to  impute  income.   In deciding  the  reconsideration
motion,  the  court  instead appears to have relied  on  the  net
proceeds  only  to  conduct a reality check to determine  whether
there  was  a significant difference between Shepherds income  as
previously  determined in April and her income as represented  in
her  motion  for  reconsideration, and thus to determine  whether
Shepherds Civil Rule 77 reconsideration motion should be granted.
          In  any  event,  it  would not have been  an  abuse  of
discretion to impute some investment income to Shepherd from  the
sale proceeds of the rental property.  Her primary argument, that
investment income can only be imputed to a parent who voluntarily
and  unreasonably is unemployed or underemployed, misreads Alaska
Civil Rule 90.3.
          Alaska Civil Rule 90.3(a)(4) states:
          The  court may calculate child support  based
          on a determination of the potential income of
          a  parent who voluntarily and unreasonably is
          unemployed or underemployed. . . .  Potential
          income  will  be based upon the parents  work
          history,     qualifications,     and      job
          opportunities.   The court  also  may  impute
          potential income for non-income or low income
          producing assets.
          
(Emphasis  added.)   Also  indicates that  imputing  income  from
underproducing   assets   differs  from   imputation   based   on
underemployment.   In  effect, Rule 90.3(a)(4)  provides  that  a
court  may  impute employment income when there  is  unreasonable
underemployment and may impute investment income when there is  a
non-income  or  low-income producing asset.  The  rule  does  not
expressly or implicitly condition imputation of investment income
on unemployment or underemployment.
          Shepherd    cites   several   cases   discussing    the
unemployment  or  underemployment of parents9  and  asserts  that
[t]he  unifying theme in these opinions is . . . that income  may
only  be imputed to a parent who voluntarily and unreasonably  is
unemployed  or underemployed. 10  These cases are  not  on  point
because  they only discuss employment income and do  not  discuss
underperforming assets.  Shepherd cites nothing to  suggest  that
the voluntarily and unreasonably . . . underemployed finding that
Rule  90.3  requires before imputing employment  income  is  also
required if income is to be imputed from underperforming assets.
          Moreover,  our  decisions  indicate  that  it  is   not
necessary  to find underemployment before imputing asset  income.
In  Laybourn v. Powell, we held that the superior court  properly
imputed  income  to  Laybourn based on his  efforts  to  disguise
actual  earnings  and conceal assets, even though  there  was  no
finding that he was underemployed or unemployed.11  We noted that
          underreporting income or hiding assets is functionally equivalent
to  voluntary  underemployment.12  We did not discuss  whether  a
finding of deliberate underemployment is necessary for imputation
of  income from assets (and presumably the parties had not argued
this), but we had no difficulty affirming an imputation of income
to someone who was fully employed but hiding assets.
          In  Ogard  v.  Ogard, we noted that  where  an  obligor
parent  has  reduced  his  or her income by  liquidating  income-
producing assets and applying the proceeds to the mortgage on his
or  her  dwelling, a trial court might have good cause to  impute
earnings.13    The   American  Law  Institute  (ALI)   recommends
imputation  of asset income without regard to whether the  parent
is underemployed.  The Institutes Principles of the Law of Family
Dissolution:  Analysis  and  Recommendations  states  that   [i]n
calculating a parents income, the court may . . . (b)  impute  an
ordinary  rate  of return to an asset that yields  less  than  an
ordinary rate of return.14  The ALI further explains that a court
should  impute  an ordinary rate of return on a  stock  portfolio
producing  little or no income even for someone who  is  employed
and earns a substantial salary.15
          Given Rule 90.3(a)(4)s statement that [t]he court  also
may impute potential income for . . . low income producing assets
and  our  precedents,  it would not have  been  error  to  impute
investment  income  to Shepherd without first finding  deliberate
underemployment.
          Shepherd  also  briefly argues that  investment  income
should  not  be  imputed  because she did  not  unreasonably  and
voluntarily  forgo  income-producing assets.  She  contends  that
selling  the  rental property was reasonable and that  given  her
then-extant  economic  circumstances, it would  be  difficult  to
conclude  that selling the property was actually voluntary.   The
voluntary and unreasonable requirements set out in Rule 90.3  for
imputation    expressly   apply   only   to   unemployment    and
underemployment.16  Thus, in Ogard, we noted that the trial court
could impute earnings if a parent sold income-producing assets in
order  to reduce mortgage payments.17  Such a reinvestment  would
not  be  unreasonable,  but  selling  one  investment  to  offset
liabilities  would  presumably  improve  the  parents   financial
situation,  and it is not obvious why it would be  reasonable  to
decrease that parents share of child support based on the loss of
the  asset.   Also, the issue is not whether it was  unreasonable
for  Shepherd to sell the property.  It is whether,  having  sold
the  property,  Shepherd could fail to use any of the  net  sales
proceeds  to generate income.  Shepherd has not squarely disputed
that  issue.   She  did  not demonstrate  below  that  the  sales
proceeds  were  exhausted  or that the superior  court  erred  in
stating  that  it  is  reasonable to assume that  at  least  some
portion of this money will be invested in such a way as to net at
least  $909  per year.  Given the evidence before  the  court  on
reconsideration, the court could reason that it would  have  been
unreasonable  to use none of the sales proceeds to generate  some
nominal replacement income.
           Shepherd  argues in the alternative that even  if  the
superior court did not err by imputing some investment income, it
erred in determining the amount of Shepherds adjusted income  for
child  support  purposes.  Shepherd asserts that the  net  rental
income  of approximately $21,000 would have been reduced  by  the
cost  of  a  handyperson  because she could  not  have  performed
building maintenance herself.  She also asserts that the  $21,000
figure  she listed for 2002 was wrong because it was for  all  of
the  parties  rental  properties, not just  the  rental  property
awarded  to  her.  Hence [t]o impute future income from  property
Ms.  Shepherd did not then own is simply unsupported by case law,
this record, or common sense.  Third, she asserts that the rental
income  should  have  been averaged over  a  two-  or  three-year
period.   These three contentions are all based on her assumption
that  the superior court imputed rental income to Shepherd.   But
the  court  did not impute rental income.  At most, the  superior
court imputed income from some portion of the net sale proceeds.
          Finally,  Shepherd  argues  that  the  court  erred  in
considering  the  proceeds from the sale of the  rental  property
because  they resulted from a one-time sale and were not  regular
income.   Rule 90.3, Commentary III(A) suggests treating  capital
gains  as  income  only if they represent  a  regular  source  of
income.   The  superior court did not treat the one-time  capital
gain  as  income; the court only considered the net sale proceeds
insofar as they could have been reinvested to provide a source of
regular  income.  The commentary to Rule 90.3 III(A) states  that
one-time  gifts  and  inheritances should not  be  considered  as
income,  but  interest  from  the  principal  amount  should   be
considered  as  income.  By implication, there is  nothing  wrong
with  treating investment income from a one-time capital gain  as
income.
     B.   It  Was  Error To Calculate Child Support Based on  the
          Assumption  that Shepherd Would Have No Federal  Income
          Tax Liability.
          
          In  calculating allowable deductions for child  support
determination purposes, the superior court assumed that  Shepherd
would  pay  no federal income taxes on her income.  The  superior
court noted in its September order:
          In  2002, Ms. Shepherd owed no federal income
          taxes.   In 2003, she owed $14,335 in federal
          income taxes.  However, these high taxes  are
          tied  to her sale of the rental property  and
          receipt of $95,393 in capital gains.  .  .  .
          Since  her actual tax liability for 2002  was
          zero,  that  number (zero)  appears  to  most
          closely  approximate actual projected federal
          income tax liability.
          
          A  threshold question is whether the correctness of the
trial  courts assumption in calculating child support that  there
would  be  no  federal income tax liability has been  raised  and
argued sufficiently so as to be properly before us on appeal.  In
her  brief,  Shepherd  raises  the question  whether  the  record
supports  the  trial  courts calculation of  imputed  income  and
points  out  that she sought reconsideration of the trial  courts
decision,  submitting both her 2002 and 2003 income  tax  returns
and  attachments from both returns.  And in her statement of  the
case,  Shepherd  contends that she explained to the  trial  court
that  she  did not have tax liability for 2002 because that  year
she incurred significant legal expenses in relation to properties
at  issue  in the divorce.  She indicated that the legal expenses
were  deductible for federal tax purposes in tax year 2002  only.
No   one  challenged  this  valid  deduction.   Shepherd  further
maintains in her brief that she informed the trial court that she
used  the proceeds from the sale [of the rental property] to  pay
$14,335 in federal taxes for 2003.  Shepherd then points out that
[t]he  trial court failed to mention or discuss why Ms.  Shepherd
did  not  incur  income  tax liability for  2002:   the  one-time
expense  of  legal  services related to the preservation  of  her
income-producing  property.  Instead, it used the  aberration  of
property  sale-related taxes in 2003 to justify no tax  liability
or deductions in 2004.
          Shepherd  further  maintains in her  brief  that  [t]he
trial  court  also rejected the use of standard deductions  since
Ms.  Shepherd  itemizes deductions and has three  exemptions  for
income tax purposes.  The court believed that since Ms. Shepherds
tax liability for 2002 was zero, that amount should be used as it
appears  to  most  closely approximate actual  projected  federal
income  liability.    Based  on this  flawed  analysis,  Shepherd
complains, the trial court concluded that the $51,639 net  annual
income  Ms.  Shepherd represented as adjusted net income  in  her
2002  ARCP 90.3 affidavit appears to be at least that income that
best reflects current income and/or income producing ability  and
thus  denied Ms. Shepherds motion for reconsideration.   Although
these  arguments are made under the heading of statement  of  the
case, rather than in the argument section of Shepherds brief,  we
conclude that they are adequate to raise the claim on appeal.
          But  Shepherd also argues two major legal points in the
argument section of her brief:  (1) that the trial court erred in
imputing  rental  income, and (2) that, even if income  could  be
imputed,  the record failed to support the courts calculation  of
the  amount  of  her  imputed income.  In addressing  the  second
point,  her  alternative claim of computational  error,  Shepherd
specifically argues:
          [S]hould  the court be otherwise inclined  to
          impute  non-existent net  rental  income,  it
          should  average that income.  As demonstrated
          by  Ms.  Shepherds 2002 and 2003 federal  tax
          returns, rental income from the Grant  Street
          property varied from $8,904 (in 2002) to 0 in
          2003,  for  a  two-year  annual  average   of
          $4,452.  Since the property was sold in 2003,
          though,  Ms. Shepherd will receive no  rental
          proceeds from it in 2004, or hereafter and  a
          three  year  average would yield  an  average
          annual rental income of $2,968.
          
This  argument  squarely  addresses the computational  flaw  that
Shepherd  describes  in  her statement of  facts:   the  superior
courts failure to recognize that Shepherds 2002 zero federal  tax
liability  was a one-time event.  Shepards argument for averaging
hinges  on  the validity of her claim that the 2002 tax deduction
was  non-recurring.  While Shepherds argument does not draw  this
connection  explicitly, the point is implicit,  and  her  minimal
treatment of it seems unsurprising given that the reason for  the
zero tax liability in 2002 has apparently never been questioned.
          In  responding  to a question from this court  at  oral
argument,  Shepherd maintained that the superior courts September
order  was  erroneous because the court assumed Shepherds  normal
federal income tax liability was zero.  For all of these reasons,
we conclude that the issue of Shepherds tax liability is properly
before us, and we therefore turn to the merits.  Under Civil Rule
90.3(a)(1)(A)(I),  federal income tax is to be  deducted  from  a
parents  gross income in order to determine the parents  adjusted
annual  income.  We have previously directed that federal  income
tax   liability   should  be  deducted  from  imputed   income.18
Therefore,  we remand this case to the trial court  to  determine
the  amount  that should be deducted from Shepherds  income.   On
remand,  the  trial court may take into account  the  actual  tax
liability of Shepherd as reflected in her tax returns.
V.   CONCLUSION
          For  the  reasons  stated above,  the  superior  courts
imputation  of  investment income is AFFIRMED  but  the  case  is
REMANDED  so  that the trial court may determine  the  amount  of
Shepherds  federal income tax liability and recalculate Shepherds
adjusted annual income to account for that tax liability.

EASTAUGH,   Justice,   with  whom  CARPENETI,   Justice,   joins,
dissenting in part.
          The  court  reasons that the superior  court  erred  in
assuming  that  appellant Shepherd would pay  no  income  taxes.1
Because such an error could affect the child support award,2  the
court   remands  for  determination  of  appellants  income   tax
liability.3
          I  respectfully  dissent from the part  of  the  courts
opinion  that remands for that determination.  Appellants lawyers
have  not argued any such error on appeal and the pro se appellee
has  not addressed the topic.  The court concludes that appellant
Shepherd  adequately raised the  income tax question on  appeal,4
but  in  my  view,  she did not raise the issue  at  all,  either
explicitly  or implicitly.  We should therefore not consider  the
income  tax liability topic, much less grant relief to  appellant
on this unpreserved issue.
          It  may seem hypertechnical to require an appellant  to
argue  an  issue  explicitly.   After  all,  the  appellant  here
probably  raised the issue in the superior court, and this  court
apparently considers the issue to be so clear that its merits can
be  resolved  with  only  four lines of discussion5  and  without
benefit  of  appellate briefing. But there are good  reasons  for
requiring  appellants to argue an issue explicitly, or  at  least
implicitly.
          Our  appellate rules specify how litigants must present
issues  and we have applied those standards in treating as waived
issues  that  were not adequately briefed.  Thus, Appellate  Rule
212(c),  labeled  Substantive Requirements,  specifies  that  the
appellants brief shall contain, among other items, a statement of
issues  presented for review, a statement of the case  describing
the  procedural history and relevant facts, an argument  section,
and  a  short  conclusion  stating  the  precise  relief  sought.
Appellate  Rule  212(c)(1)(I) provides that the argument  section
shall  contain the contentions of the appellant with  respect  to
the issues presented, and the reasons therefor, with citations to
the  authorities,  statutes, and parts of the record  relied  on.
(Emphasis  added.)   We  do  not treat the  argument  requirement
lightly.   We  have held that [w]here a point is not  given  more
than a cursory statement in the argument portion of a brief,  the
point  will not be considered on appeal.6  Even pro se  litigants
must  adhere  to  this standard even though we tend  to  be  more
expansive in interpreting their arguments.7
          We adopted Rule 212 not to satisfy an esthetic interest
in  the cosmetic appearance of briefs, but to make sure that  the
issues  we  decide  are  truly in controversy,  that  we  do  not
overlook  issues the parties have raised, and that  we  have  the
benefit  of the parties thoughts about the facts and law  bearing
on  issues  we are deciding.  Some elemental rigor in  describing
the  issues for decision also helps with the doctrines of law  of
the case and res judicata.
          Due   process  is  the  ultimate  foundation  for   the
preservation requirement.  Ruling against an appellee on an issue
the  appellant has not raised deprives the appellee of notice and
an   opportunity  to  be  heard.   Doing  so  can  be  especially
          prejudicial to pro se appellees, who lose both the opportunity to
decide  whether  to hire counsel to address the (unraised)  issue
and the opportunity to address the issue themselves.
          There  are  various reasons why an appellant might  not
brief a particular issue.  An appellant might decide to focus  on
particularly compelling contentions, and to ignore  others.   The
primary,  if not only, theme of Shepherds appeal is that  it  was
error  to impute rental income to Shepherd.  Appellants Brief  at
1,13-14,15,16, 21, 22, 23, 24, 25.  Counsel could  have  reasoned
that  this was a compelling theme, given undisputed evidence that
Shepherd had been awarded only one rental property, that she sold
in  2003.  And evidence she sold only it because appellee  failed
to  pay  child support supported her assertion that she  did  not
unreasonably  or  voluntarily forgo rental  income,  thus  making
imputation  inappropriate.  Appellants  Brief  at  19-20,  23-24.
There  is  good reason to think appellants counsel chose  not  to
argue the tax issue.8  An appellant might also choose to avoid an
issue  in  order to limit the appellees responsive arguments  and
minimize   discussion   of   unflattering   evidence   or   legal
propositions, or to limit the issues to be litigated on remand.
          Of  course,  a  party might not raise an issue  through
simple  oversight.  But even if an appellants lawyer is negligent
in  failing  to brief a meritorious issue or a pro  se  appellant
fails  to discuss an issue, we regard it as unraised.9   It  does
not  matter why the issue is not raised; we do not decide  issues
not raised by the parties.10
          This is a particularly unworthy case for considering an
unraised  issue  and using it to grant relief to appellant.   Two
lawyers co-signed Shepherds substantial opening and reply briefs,
and   her   oral  argument  exceeded  the  usual  time  allotted.
Haralovich, by comparison, filed only an eight-page pro se brief,
much of which discusses matters of little relevance to the issues
on  appeal.   He  argued  for only nine of his  allotted  fifteen
minutes.  Here Shepherd had the burden of going forward on appeal
and  demonstrating  both legal error and  prejudice.   If,  as  I
think, she did not raise the issue, the pro se appellee is  being
treated unjustly.
          Do   Shepherds  briefs  raise  the  issue?   No.    Not
explicitly.  Not implicitly.  And certainly not adequately.
          The issue and argument parts of Shepherds two briefs do
not  list,  describe,  or discuss any error  in  calculating  the
income  tax  deduction.  It would therefore seem  that  prolonged
review  of  the appellants briefs is not needed to  confirm  that
Shepherd  has not asked us to reverse on the theory the  superior
court  miscalculated the income tax deduction in  awarding  child
support.   If Shepherd were asking us to do so, one would  expect
the  argument  part of her brief to clearly and  directly  assert
that the superior court erred by failing to deduct Shepherds  tax
liability and by assuming there was zero tax liability, and  that
reversal  is  therefore required.  This argument  can  be  easily
made.  It is factually and legally simple.  Although she made  no
such  argument  on appeal she raised the issue  in  the  superior
court.   The  argument  there could have been  clearer,  but  she
asserted  that it was error to assume Shepherd had no income  tax
          liability.  This confirms that her lawyers, who co-signed her
appellate briefs and also represented her in the superior  court,
knew how to raise the issue when they wanted to.
          The  courts opinion reviews Shepherds opening brief  at
some  length  and concludes that the issue was raised,  at  least
implicitly.11   A casual reader unfamiliar with Shepherds  briefs
and her actual arguments might assume from the courts description
of  her  opening brief that Shepherd actually argued  the  issue.
Only  a  reader familiar with that brief would know what part  of
the brief contains the passages quoted or described by the court.
          Considered part-by-part, appellants opening brief  does
not  brief the remand issue.  All of the direct references to the
issue  are  found in, and only in, the part of the opening  brief
discussing the transactional and procedural facts.12
          Thus,  the table of contents of the opening brief lists
the  argument sections main topic headings as follows:  The trial
court  erred  by  imputing any income to  Ms.  Shepherd,  who  is
neither unemployed nor underemployed . . . . The record does  not
support   the   trial  courts  calculation  of  imputed   income.
Appellants  Brief  at ii.  Neither heading mentions  taxes;  both
headings refer to imputation of income.
          Part V of the brief lists the two issues presented  for
review as follows:
               1.   Did the trial court err by imputing
          income to appellant?
          
               2.   If  the trial court did not err  in
          imputing  income to appellant, did the  trial
          court err in determining the amount of income
          to impute to appellant?
          
Appellants  Brief at 1.  Both issues focus on the  imputation  of
income.  The first asks whether it was error to impute income  to
Shepherd;   the   second  asks  whether  the  court   erroneously
determined  the amount of imputed income.  Neither issue  as  set
out  mentions  taxes or tax errors.  No stand-alone computational
issue  is  listed;  the computational issue  listed  by  Shepherd
arises only if the superior court imputed income to Shepherd.
          The  court  correctly notes that Part VI of the  brief,
setting  out the statement of the case, does discuss the superior
courts  rulings on the income tax deduction and what the superior
court  assumed about Shepherds annual income taxes.13  That  part
is   fourteen   pages  long.   It  also  discusses   many   other
transactional  and procedural facts.  Appellants Brief  at  1-14.
Some  of those facts do not directly bear on any appellate issue,
and  many relate to the property division that awarded the rental
property  to Shepherd, her sale of that property, and Haralovichs
alleged   noncompliance  with  his  child  support   obligations.
Shepherds  fact  statement discusses at  length  the  orders  and
reconsideration  motions that culminated in  the  September  2004
order.   Appellants Brief at 1-14.  It consequently  describes  a
variety  of  superior court issues and rulings that  are  not  at
issue on appeal.
          Part  VIII  is the briefs argument part.   It  contains
          three sections.  The first section discusses applicable case law.
This  section  discusses  only the legal  standard  for  deciding
whether  to impute income.   Appellants Brief at 15-17.  It  does
not  discuss  how  any imputed amount should be  calculated.   It
focuses  on demonstrating that income may be imputed  only  if  a
parent   is   voluntarily   and   unreasonably   unemployed    or
underemployed.  Appellants Brief at 17.
          The  second  and third sections of appellants  argument
part  both  address imputed rental income.  Both presuppose  that
the  superior  court  imputed rental income  to  Shepherd.   Both
therefore state the issues in even more limited fashion than  the
two  issues described in Part V, which lists the issues presented
for review.
          Thus,  the second argument section argues that  it  was
error  to  impute rental income to Shepherd for property  she  no
longer  owns.  Appellants  Brief at  21.  Nothing in that section
discusses  income  tax  liability;  it  largely  focuses  on  her
contention  that she acted reasonably and involuntarily  in  2003
when  she  sold the only rental property she owned, and that  the
standard for imputing income was therefore not met.14  Appellants
Brief  at 19-21.  There is no basis in this argument section  for
granting her any appellate relief if, as the entire court agrees,
the  superior court did not in fact impute any rental  income  to
Shepherd.15
          The  third argument section argues that the record does
not  support  imputing to Shepherd net rental income of  $21,288.
Appellants  Brief  at 21.  It also contains ancillary  arguments,
all  relating  to  imputation of rental income.   None  of  those
arguments  asserts that the superior court erred  in  basing  the
income  calculation  on  the  one-year  experience  of  zero  tax
liability.   Appellants  Brief at  22-23.   None  challenges  the
correctness  of the trial courts assumption in calculating  child
support  that there would be no federal income tax liability,  as
this  court  describes the issue before deciding whether  it  was
raised and argued sufficiently so as to be properly before us  on
appeal.16    Critical  to  her  argument   that   there   was   a
calculational  error is Shepherds contention  that  the  superior
court imputed a substantial amount of rental income to her.   But
all  members of this court agree that there was no imputation  of
rental  income.17  We thus unanimously reject  the  root  of  her
argument.   Her claim of calculational error, as argued,  withers
away.
          Part IV.B of the courts opinion concludes that Shepherd
raised   and   sufficiently  argued  the  issue  of  income   tax
liability.18   I disagree.  Surely Haralovich will too,  when  he
learns  to  his surprise that the only issue on which  the  court
remands  is one that Shepherd has not argued on appeal and  which
Haralovich  therefore had no reason to think  he  should  address
either.
          I  do not think Shepherd has preserved the issue merely
by  unfavorably characterizing in the facts section of her  brief
the  superior  courts decision not to give  her  credit  for  any
income tax deductions.19
          I  also  do  not  think that the portion  of  Shepherds
          argument section quoted at length on page 14 of the courts
opinion refers, expressly or implicitly, to Shepherds income  tax
liability.   Shepherd argues in that passage  only  that  if  any
rental  income  is to be imputed to her, it should  be  only  the
average of her rental income over two years, including a year  in
which  she  earned no rental income.20  Appellants Brief  at  25.
This  reading  of  the argument is supported by  Shepherds  reply
brief,  which  states  that the matter now properly  before  this
Court  [is] [d]id the trial court erroneously impute non-existent
rental income from long-sold property to appellant?  Reply  Brief
at  1.  Her reply brief later reiterates the dispute as she  sees
it:   the  issue  properly before this court [is]  imputation  of
income to Ms. Shepherd from real property previously sold.  Reply
Brief at 8.
          The   court  reads  passages  in  Shepherds  brief   as
discussing and raising the issue, at least implicitly.21  But all
of the passages discussed by the courts opinion beginning at page
13  line  6  through page 14 line 6 are found only  in  the  fact
portion,  not  the  argument portion, of appellants  brief.   The
passage quoted in the opinion at page 14 lines 12 through 20 says
nothing of an alleged error in assuming zero tax liability.  That
passage speaks of 0 rental income, not of an erroneous assumption
there was 0 tax.22
          The  issue  perceived by the court is not implicit  nor
can   it   be  characterized  as  having  received  even  minimal
treatment.23   If  the issue had been raised,  one  would  expect
Shepherds lawyers to have cited some authority to demonstrate the
error,  presumably  the  same  Civil  Rule  the  court  cites  in
confirming that income tax is to be deducted from gross income.24
But  the  passage of the brief quoted at page 14 of  the  opinion
says  nothing of a failure to deduct taxes, cites no rule or case
discussing  a  deduction for taxes, and only refers  to  the  tax
returns  to  demonstrate that rental income dropped  to  zero  in
2003.   Appellants Brief at 25.  This argument is made to support
Shepherds  claim the rental income should be averaged,  not  that
tax payments should be deducted.  Appellants Brief at 25.25
          The  topic  did  come up briefly at oral argument,  but
only  because a member of this court asked Shepherds  counsel  if
the  September  order  was in error because  the  superior  court
assumed  that  Shepherds normal federal income tax liability  was
zero.  Not surprisingly, counsel agreed, recognizing a slow pitch
when  he  saw  one, but nothing in appellants briefs raised  that
question.   And  if  a  member of the court had  not  asked  that
question,  the topic would not have been mentioned  at  argument.
Parties  may not raise new issues at oral argument.26   That  the
court  sua  sponte raised the topic at argument does  not  excuse
Shepherds   failure   to   preserve   the   issue.    Haralovich,
representing himself, had no adequate warning that he  should  be
prepared to discuss a topic not mentioned in the briefs.
          Finally,  even  if  Shepherds opening  brief  could  be
charitably read to have mentioned the issue, it was mentioned  so
indirectly  and obscurely that we should hold the discussion  was
too cursory to have preserved the issue.
          We should therefore affirm every aspect of the superior
          courts grant of summary judgment and final order denying
reconsideration.  I join in the courts opinion to the  extent  it
affirms  the superior courts grant of summary judgment and  final
order denying reconsideration.
_______________________________
     1     Alaska  Civil Rule 90.3, Commentary III A(16) suggests
capital gains should be treated as income only to the extent they
represent a regular source of income.

     2     Neal  &  Co., Inc. v. Assn of Vill. Council Presidents
Regl Hous. Auth., 895 P.2d 497, 506 (Alaska 1995).

     3     OConnell  v. Christenson, 75 P.3d 1037,  1039  (Alaska
2003)  (citing  Rhodes  v. Rhodes, 754 P.2d  1333,  1335  (Alaska
1988)).

     4     Peter  Pan Seafoods, Inc. v. Stepanoff, 650 P.2d  375,
378-79 (Alaska 1982).

     5     Turinsky v. Long, 910 P.2d 590, 594 n.10 (Alaska 1996)
(citing  Charlesworth v. State, Child Support  Enforcement  Div.,
779 P.2d 792, 793 (Alaska 1989)).

     6    Paxton v. Gavlak, 100 P.3d 7, 10 (Alaska 2004).

     7    Quoting Alaska Civil Rule 90.3, Commentary III(C).

     8     See, e.g., OConnell, 75 P.3d at 1038 (explaining  that
superior court imputed income of $43,550.13 to OConnell and  then
calculated his support obligation based on this amount).

     9     Shepherds  brief  cites:  Nunley  v.  State,  Dept  of
Revenue, Child Support Enforcement Div., 99 P.3d 7 (Alaska 2004);
Olmstead  v.  Ziegler, 42 P.3d 1102 (Alaska  2002);  Robinson  v.
Robinson,  961 P.2d 1000 (Alaska 1998); Vokacek v.  Vokacek,  933
P.2d  544  (Alaska  1997); Kowalski v. Kowalski,  806  P.2d  1368
(Alaska 1991); and Pattee v. Pattee, 744 P.2d 658 (Alaska  1987).
Pattee  is the only one of these cases to mention sale of assets,
but Pattee did not involve imputation of asset income, and it was
decided under the framework existing before Rule 90.3, which  was
adopted  by  Supreme Court Order No. 833 (April  30,  1987),  and
became effective in August 1987.  See Pattee, 744 P.2d at 662.

     10    Quoting Alaska Civil Rule 90.3, Commentary III(C).

     11    Laybourn v. Powell, 55 P.3d 745, 746 (Alaska 2002).

     12    Id. at 747.

     13    Ogard v. Ogard, 808 P.2d 815, 819 n.6 (Alaska 1991).

     14    American Law Institute, Principles of the Law of Family
Dissolution: Analysis and Recommendations  3.14(4) (2002).

     15    Id. at  3.14 cmt. d.

     16     The  court  may calculate child support  based  on  a
determination of the potential income of a parent who voluntarily
and  unreasonably is unemployed or underemployed.   Alaska  Civil
Rule 90.3(a)(4).

     17    Ogard, 808 P.2d at 819 n.6.

     18    Rodvik v. Rodvik, 151 P.3d 338, 351 (Alaska 2006).

1    Slip Op. at 12, 15.

     2     Alaska  R.  Civ. P. 90.3(a)(1)(A)(i)  (providing  that
income taxes are deductible from gross income).

     3    Slip Op. at 15.

     4    Slip. Op. at 14, 15.

     5    Slip Op. at 15 ll. 5-8.

     6     Petersen v. Mut. Life Ins. Co. of N.Y., 803 P.2d  406,
410 (Alaska 1990) (citations omitted).

     7     Peterson  v.  Ek, 93 P.3d 458, 464 n.9  (Alaska  2004)
(stating that [w]e judge a pro se litigants performance by a less
demanding standard); Gates v. City of Tenakee Springs,  822  P.2d
455,  460 (Alaska 1991) (treating as abandoned claims of  pro  se
litigant  raised  below  but only cursorily  or  not  at  all  on
appeal).

8     Shepherds  statement of points on appeal,  filed  when  she
commenced  her  appeal, included this appellate  contention:   2.
The  trial court erred in failing to include mandatory deductions
from gross income which appellant is entitled to receive pursuant
to  Alaska  R.  Civ. P. 90.3.  Had this point been  discussed  in
these  terms  in appellants arguments, there is no  question  she
would have preserved it.  But because the other two points listed
on  her  statement of points on appeal correspond exactly to  the
two  arguments  she  does raise in Part VIII  of  her  brief,  it
appears  she  intentionally  chose  not  to  brief  this   issue.
Comparing  the  text of the point with the text of her  arguments
also strongly suggests intentional waiver.  See note 25 below.

     9    Cf. State v. ONeill Investigations, Inc., 609 P.2d 520,
528  (Alaska 1980) (When, in the argument portion of a  brief,  a
major  point  has been given no more than cursory  statement,  we
will   not  consider  it  further.   Failure  to  argue  a  point
constitutes an abandonment of it.).

     10   Id.

11    Slip  Op.  at 13-14.  The court refers only  to  appellants
opening brief.  Nothing in appellants reply brief can be read  to
raise  the  issue,  although the reply  brief  does  confirm  how
limited the appellate issues are.  Thus, it asserts that Many  of
appellees  assertions  are  simply not  relevant  to  the  matter
properly  before  this  Court: Did the  trial  court  erroneously
impute  non-existent  rental income from  long-sold  property  to
appellant?  Reply Brief at 1.

     12    I  use the word issue advisedly, without implying that
the  tax question is indeed an appellate issue.  The tax question
was  an issue in the superior court.  It is an issue before  this
court  only  because  this court says  it  is,  not  because  the
appellant says it is.

     13   This is the part that, per Appellate Rule 212(c)(1)(G),
shall  provide  a  brief description of the case  and  a  concise
statement  of the course of proceedings in, and the decision  of,
the  trial  court.  Appellant shall state the facts  relevant  to
each  issue,  with  references  to  the  record  as  required  by
paragraph (c)(8), in this section or in the appropriate  argument
sections.

14    To  impute  employment  income, a  court  must  first  find
voluntary and unreasonable unemployment or underemployment.  Slip
Op. at 8 (citing Alaska Civil Rule 90.3(a)(4)).   Shepherd relies
on  the  standard  for imputing employment  income,  but  she  is
actually  contending that the superior court imputed rental,  not
employment, income to her.  Appellants Brief at 17, 19-21.

     15   Slip Op. at 12.

     16   Slip Op. at 13.

     17   Slip Op. at 12.

     18   Slip Op. at 13, 14.

     19    The distinction between the fact and argument sections
of  the brief may seem, at first glance, to be unduly harsh.   It
is   not,   for  two  reasons.   First,  Alaska  Appellate   Rule
212(c)(1)(I) and our case law both explicitly require that issues
be preserved in the argument portion of the brief.  Second, if we
permit  parties  to  treat  negative  characterizations  of   the
superior  courts  decision as if they were  legal  arguments,  we
allow  them  to  unfairly surprise their adversaries.   Following
this  case, parties will be required to carefully parse the facts
for  any  lurking  legal  issues,  even  if  their  opponent   is
represented by legal counsel.   Moreover, parties often include a
thorough  discussion of the procedural history of a case,  partly
because our rules seem to encourage it, and perhaps also to  give
some  indication  whether  any  alleged  error  was  harmless  or
prejudicial.   Treating this history as argument,  at  least  for
represented appellants, can only lead to surprise and confusion.

20   Slip Op. at 14.

     21   Slip Op. at 12-15.

     22    Compare Slip Op. at 14 ll. 21-23 with Shepherds quoted
passage.

     23   Slip Op. at 14.

     24     Slip   Op.   at   15   (citing  Alaska   Civil   Rule
90.3(a)(1)(A)(i)).

     25   Comparing appellants brief with the statement of points
appellant  filed when she commenced her appeal, see  footnote  8,
above,  confirms  that  she  has  not  argued  the  issue,   even
implicitly.  The relevant words in her second point on appeal are
mandatory   deductions,  gross  income,  and  Civil  Rule   90.3.
Mandatory,  deductions, gross income, and 90.3 appear nowhere  in
the  table of contents (and thus the argument headings), the list
of  issues, the standard of review, or the conclusion sections of
appellants  brief.   The words mandatory, deductions,  and  gross
income  appear nowhere in the three parts of appellants  argument
section  of  her brief.  And the references to Rule 90.3  in  the
argument section are never offered to support any contention that
income  taxes  must be deducted from gross income,  or  that  the
superior  court  erred  in calculating income  tax  liability  or
deductions due for income tax liability.  The statement of points
on  appeal  therefore implies that Shepherds attorneys  chose  to
waive the argument on appeal.

     26    See  Petersen v. Mut. Life Ins. Co. of N.Y., 803  P.2d
406,  411 (Alaska 1990) (holding that when appellants brief  does
not raise an argument, issue is waived).

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