High income cases which have a child support component call for creativity of child support lawyers to avoid situation in which unwarranted alimony is dressed in child support’s clothes. So often, the lawyers of payor litigants question whether the child support they pay in New Jersey is actually going to the benefit of the child.
The Guidelines are a rebuttable presumption, and the Court is specifically permitted to disregard them in appropriate cases. Pressler & Verniero, Current N.J. Court Rules, Appendix IX-A to R. 5:6A at 2541. The Guidelines note that Appendix I-F awards are in appropriate in cases where the parties have an annual combined income in excess of $187,200. R. 5:6A, Appendix IX-A; Caplan v. Caplan, 182 N.J. 250, 265-66 (2005). When the annual family income exceeds $187,200, the trial court is directed to apply the Guidelines up to the ceiling and then may supplement the award utilizing the factors set forth in N.J.S.A. 2A:34-23(a). R. 5:6A, Appendix IX-A; Caplan, supra, 182 N.J. at 265-66.
“In the context of high-income parents whose ability to pay is not an issue, ‘the dominant guideline for consideration is the reasonable needs of the children, which must be addressed in the context of the standard of living of the parties.’” Strahan v. Strahan, 402 N.J. Super. 298, 307 (App. Div. 2008) see also Isaacson v. Isaacson, 348 N.J. Super. 560, 581 (App. Div.), certif.. denied, 174 N.J. 364 (2002). On the other hand, care must be taken to craft an award that does not concentrate solely on income but also reflects the established lifestyle, which in turn often reflects parental values. Id. at. at 307-08; Isaacson, supra, 348 N.J. Super. at 582. Even in high-income cases “the custodial parent bears the burden of establishing the reasonableness” of the expenses sought. Id.; see also Accardi v. Accardi, 369 N.J. Super. 75, 88 (App. Div. 2004).
In the oft cited Strahan v. Strahan, supra, the trial court awarded the custodial mother $214,000 per year in child support for three (3) year old twin girls. The father, Michael Strahan, a well known football player, appealed the trial court’s decision. He maintained that the award was a windfall to the mother, and that the judge erred in failing to impute any income to her. The Appellate Division agreed. In remanding the matter, the Court cautioned that in making such a determination, “a custodial parent cannot through the guise of the incidental benefits of child support gain a benefit beyond that which is merely incidental to a benefit being conferred on the child.” Strahan, supra, at 225-26 (emphasis added). “The award of nonessential additions to child support requires a careful weighing and determination as to who is the primary and who is the incidental beneficiary of such support.” Id. At 226.
In the unreported decision of Isaacson v. Isaacson, 2012 WL 913083 (App. Div. Mar. 20, 2012), the Appellate Division affirmed a trial court’s decision declining to increase child support on the basis of the custodial mother’s claims of the father’s increased income alone. Id. At *4.
There, the mother filed a motion for upward modification of child support for her two (2) teenage children when she discovered that the father’s income had increased from approximately $500,000 to in excess of $1.5 million. Id. At *2. In denying the mother’s application, the trial court found that the father paid a total of $75,360 per year attributed to child support, college expenses and spending money on behalf of the older child, and for the younger child, the figures were approximately the same. Id. at *4. The father also paid $3,500 per month in child support despite both children’s attendance at college, never seeking a downward modification until they were emancipated. Ibid.
The trial judge enumerated the various “extra” expenses for which the father paid, including study abroad, summers in Israel, and additional semesters in college. Id. at *2. The judge further noted that the father’s extraordinary income enabled him to pay extraordinary expenses on behalf of his daughters and that, through his direct support and educational contributions, he “shared his financial wealth with them.” Id. at *2-3. As such, the trial court denied the mother’s motion. Id. at *2. The mother appealed. Id. at *3.
The Appellate Division affirmed, nothing that “plaintiff’s significant change in income does not automatically warrant a proportional change in child support.” Id. at *4. This was particularly true in light of the father’s direct contributions to the children, as well as his payment for educational costs, resulting in a total yearly contribution toward support in the amount of approximately $137,920. Ibid. While the Court noted that “no increase precisely mirroring plaintiff’s vast increase in income resulted,” still, “a very significant increase in contribution occurred.” Ibid. As such, the Court concluded that the mother failed to establish that the needs of the children exceeded the amount of support paid and affirmed the decision of the trial court. Id. at *4-5.
There have been other unreported decisions in which the Appellate Division has frowned on having the non0custodial parent make payments directly to the children, citing concerns that the custodial parent should have a part in the decision making.
So what to do? The Child Support Guidelines contemplate that various items and activities are included in the Guidelines. These include all clothing, all footwear (except for special footwear for sports), memberships, lessons or instructions, books, school supplies, cell phones, sports equipment, hobbies, social events, and the like. When drafting a settlement agreement, one option may be to have the high wage earner agree to pay all of the expenses which are listed above, so long as they are agreed upon. This creates a situation in which both parents are involved in decision making; the expenses are for the children’s expenses as contemplated by the status, and gives the custodial parent additional discretionary income as he or she does not have to pay the above noted expenses out of child support.
Please contact the child support lawyers at our law firm if you need our assistance.