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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Ferguson v. Ferguson (10/16/2008) sp-6317
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
suggested 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
| VICTORIA FERGUSON, | ) |
| ) Supreme Court No. S- 12837 | |
| Appellant, | ) |
| ) Superior Court No. | |
| v. | ) 3AN-01-07834 CI |
| ) | |
| JAMES FERGUSON, | ) O P I N I O N |
| ) | |
| Appellee. | ) No. 6317 October 16, 2008 |
| ) | |
Appeal from the Superior Court of the State
of Alaska, Third Judicial District,
Anchorage, Sen K. Tan, Judge.
Appearances: Allison E. Mendel, Mendel &
Associates, Anchorage, for Appellant. Andrew
Josephson, Law Offices of Dan Allan &
Associates, Anchorage, for Appellee.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, Carpeneti, and Winfree, Justices.
FABE, Chief Justice.
I. INTRODUCTION
Victoria Ferguson appeals the superior courts order
denying her motion
to modify the child support agreement she entered into with her
former husband, James Ferguson. She argues that the lower court
failed to make an adequate inquiry into the facts underlying her
claim and that it mistakenly concluded that no change of
circumstances could justify a modification. Victoria also
appeals the lower courts award of attorneys fees. Because the
Fergusons prior agreement contemplated Victorias current
circumstances, Victoria has already received the maximum amount
of child support available under Alaska Rule of Civil Procedure
90.3. And the trial court properly concluded that Victoria can
adequately provide for her childrens needs. Finally, the award
of attorneys fees fell within the superior courts discretion. We
therefore affirm the lower courts decision in all respects.
II. FACTS AND PROCEEDINGS
James (Jim) and Victoria Ferguson were married in 1984.
They had three children together, the oldest of whom is now
eighteen. They divorced in September 2001. Prior to the
divorce, Jim and Victoria agreed to a division of their real
estate and investment assets, and they formed a parenting plan
that addressed custody, visitation schedules, and child support,
among other issues. Superior Court Judge Sen K. Tan found that
the Fergusons agreement represented a fair and equitable
distribution of the marital assets that served the best interests
of the children. Accordingly, the lower court incorporated the
settlement terms into its divorce decree.
Jim and Victoria agreed to an unequal property division
under which Victoria was to receive $233,000 more of the marital
assets than Jim in lieu of future child support payments.
Victoria was also to receive $60,000 worth of assets as a lump
sum spousal maintenance payment. The parenting plan contemplated
shared physical custody consisting of a minimum time of 30%-50%
of the time with either parent after a one-year transitional
visitation plan. But the agreement clarified that [t]hough the
parties will have shared physical custody beginning August 1,
2002, the child support calculations are based on the mother
having primary physical custody of the minor children throughout
their minority. A table accompanying the plan indicates that the
parties calculated child support on the basis that Jim would earn
an adjusted income of $100,000, an amount that exceeded the
$84,000 cap established by Civil Rule 90.3 at the time.1
The superior court closely scrutinized the Fergusons
child support agreement, expressing concern about the lump-sum
payment of future support obligations. Judge Tan noted, I dont
know if I can set child support prospectively and essentially by
agreement, remove the right to file a modification. Victorias
counsel at the time reassured the court, insisting that the
Fergusons arrangement was appropriate in the unusual circumstance
in which people can afford to prepay child support. Victorias
counsel added that both parties understand that theyve agreed on
a certain physical [custody] arrangement today and that
arrangement may change . . . [but] that is not going to change
this child support arrangement. Finally, Jims counsel pointed
out that the parties calculated the child support according to
[Civil Rule] 90.3 and that the calculation uses an annual salary
of $100,000 rather than the minimum [$84,000], so if that even
if that amount did increase pursuant to [Civil Rule] 90.3, its
already taken that into account.
Following the divorce, the Fergusons soon resumed
litigation that led to the appointment of a custody investigator
and a guardian ad litem. For four years after the divorce,
Victoria did not work because she suffered from debilitating
depression. During this time, she liquidated many of her
investments and the real estate assets she had received in the
divorce settlement and withdrew funds from her IRA to maintain
her household. On May 6, 2004, the superior court issued a
revised custody order that mandated strict application of the
week-on week-off schedule. In February 2005 Victoria resumed her
former career as an engineer and began earning a gross income of
$102,000.
On October 30, 2006, Victoria filed a motion to modify
child support, alleging that over the past year all three
children increasingly . . . spent more time with her. Victoria
argued that the existing child support arrangement was inadequate
in light of this de facto change in the custody schedule. Her
motion alleged that none of the property that Victoria received
as lump sum child support was actually liquid and that the
parties took no account of the costs of sale or taxes to
liquidate the property. Consequently, Victoria reasoned, [t]he
current arrangement is not meeting the needs of the children and
needs to be modified. Jim filed a cross-motion to retroactively
modify child support in case the trial court decided to reopen
the child support issue.
Superior Court Master Suzanne R. Cole conducted
hearings on February 27 and May 15, 2007. During the first
hearing, Master Cole identified Victorias assertion of changed
circumstances as a threshold issue and indicated that she would
like to rule on that before we get to income calculations. The
master then set another hearing limited to the change of
circumstances issue. After that second hearing, the master
concluded that Victoria had failed to demonstrate a change of
circumstances and therefore issued a recommendation without
considering evidence on factors that might have informed the
extent of an award modification.
In her recommendation to the superior court, Master
Cole rejected Victorias argument that the parties had overlooked
the liquidation penalties associated with the settlement assets.
The master reasoned that Victoria had knowingly entered into the
settlement, which was carefully crafted with the assistance of
counsel, and subjected to close scrutiny by the court. According
to the master, the parties were aware that most of the assets
were not liquid and would bear tax consequences.
The master also rejected Victorias argument that the
childrens increased time in her household represented a material
change in circumstances. The master pointed out that the
Fergusons agreement anticipated a fluid custody arrangement and
calculated support based upon primary custody to Ms. Ferguson to
permit such fluidity. Because the Fergusons division of property
provided Victoria with the maximum child support under the
fiction of primary custody to Ms. Ferguson, Master Cole reasoned
that it already gave her what she now argues for a primary
custody calculation. Master Cole further concluded that the
finality of the property division bestowed benefits upon both
sides, with Jim unable to pursue his colorable claims for
modification such as his reduced income, imputed income for her,
or child support when he had primary custody.
The master distinguished the case law cited by Victoria
in support of modifying the child support agreement, giving
particular attention to State, Department of Revenue, Child
Support Enforcement Division v. Green.2 That case involved a
parent who exhausted a lump-sum payment of child support and had
to rely on state benefits to adequately meet the needs of her
child.3 Master Cole pointed out that no court had approved the
agreement at issue in Green, and that [u]nlike the obligee in
Green, Ms. Ferguson is not on the edge of poverty. Her childrens
needs are more than adequately met. Finally, Master Cole
addressed extraordinary expenses, which the Fergusons had agreed
in the original parenting agreement to share provided they were
mutually agree[d] on. Master Cole recommended that the Fergusons
divide these expenses equally for any activities in which the
children are currently participating.
On June 29, 2007, before the superior court had decided
whether to adopt the masters report, Jim filed a motion for
attorneys fees. On July 10 Victoria filed objections to the
masters report, alleging factual and legal errors. Jim opposed
the objections, and on July 26 Judge Tan adopted the masters
recommendation. The superior court ordered Victoria to file any
opposition to the motion for attorneys fees within ten days.
Victoria disputed several items in the attorney billing
statements and in his reply Jim revised his fee request downward
from $7,329 to $6,834. Eventually, Judge Tan ordered Victoria to
pay $2,050.20, or thirty percent of Jims actual reasonable fees
of $6,834.
Victoria appeals.
III. STANDARD OF REVIEW
We review a trial courts decision to modify or deny
modification of a child support order for abuse of discretion.4
We will find an abuse of discretion only where the record as a
whole leaves us with a definite and firm conviction that a
mistake has been made.5 The award of attorneys fees in a divorce
action also rests within the broad discretion of the trial court
and will not be disturbed on appeal unless it is arbitrary,
capricious, or manifestly unreasonable.6
IV. DISCUSSION
A. The Trial Court Did Not Abuse Its Discretion when It
Determined that Victoria Failed To Demonstrate a Change
of Circumstances that Requires Modification of Child
Support.