Peter J. Eisert v. Dawn M. Eisert ( 2008 )

COURT OF APPEALS OF VIRGINIA
Present: Judges McClanahan, Petty and Senior Judge Fitzpatrick
Argued at Alexandria, Virginia
PETER J. EISERT
MEMORANDUM OPINION ∗ BY
v. Record No. 2990-06-4 JUDGE ELIZABETH A. McCLANAHAN
MARCH 18, 2008
DAWN M. EISERT
FROM THE CIRCUIT COURT OF LOUDOUN COUNTY
James H. Chamblin, Judge
Marcia M. Maddox (Katharine W. Maddox; Morgan A. Leyh;
Maddox, Cole & Miller, P.C., on briefs), for appellant.
Nan M. Joseph (Joseph & Mische, P.C., on brief), for appellee.
Peter J. Eisert (husband) appeals from a final decree of divorce from Dawn M. Eisert
(wife). He contends the trial court erred in: determining the amount and duration of the spousal
support award to wife, determining the amount of the child support award, and awarding
attorney’s fees to wife. For the following reasons, we affirm the trial court.
I. BACKGROUND
In reviewing the trial court’s decision on appeal, we view the evidence in the light most
favorable to wife, the prevailing party, granting her the benefit of any reasonable inferences.
Congdon v. Congdon, 40 Va. App. 255, 258, 578 S.E.2d 833, 835 (2003). “That principle
requires us to discard the evidence of [husband] which conflicts, either directly or inferentially,
with the evidence presented by [wife] at trial.” Id. (citations and internal quotation marks
omitted).
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Pursuant to Code § 17.1-413, this opinion is not designated for publication.
The parties married in 1994, and had a son, born in 1998, and a daughter, born in 2001.
During the first four years of their marriage, they both worked for their jointly owned insurance
business, Tresie, Inc., a/k/a Eisert Insurance Service (EIS). Husband sold insurance, and wife
managed the administrative duties. Wife then stayed at home after the birth of their first child,
but continued to do administrative work from home. The business grew significantly during the
course of the marriage.
The parties separated in July 2004, and wife filed for divorce later that year. Before the
trial, the parties resolved the issues of custody and equitable distribution of marital property by
stipulation. Among other things, wife received primary physical custody of the children and
husband acquired complete ownership of EIS. In September 2006, the trial court conducted a
three-day ore tenus hearing on the issues of spousal support, child support, and attorney’s fees.
The trial court issued a letter opinion dated October 11, 2006, which it later incorporated
into its final decree of divorce, dated November 13, 2006. The court awarded wife permanent
spousal support in the amount of $15,000 per month for one year, and $13,500 per month
thereafter. The court reduced the support after year one based on its imputation of income to
wife. From expert testimony, the court found that by year two, following a period of retraining,
wife could obtain employment in office administration paying $40,000 to $44,000 a year. In
determining the support, the court calculated husband’s income as $77,000 per month, which
included approximated $73,000 per month from EIS. Furthermore, the court expressly stated in
its letter opinion that it rendered the spousal support award after it “considered [husband’s]
substantial ability to pay and [wife’s] realistic needs in light of the statutorily required factors for
consideration under Va. Code § 20-107.1(E).”
Regarding child support, the court ordered husband to pay support for the two children in
the amount of $2,943 per month, based on the court’s child support guideline worksheet. Those
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calculations did not include the cost of health insurance for the children. Rather, the court
ordered husband to continue to provide health insurance for them through EIS. The child
support award also did not include the cost of the children’s private school tuition, totaling
$2,157 per month, which the court ordered husband to pay separately.
Finally, the trial court awarded wife attorney’s fees in the amount of $60,000.
Husband filed a motion to reconsider, and then written objections, to the court’s final
order, all of which were denied.
II. ANALYSIS
Husband raises ten issues on appeal. Six issues relate to the award of spousal support,
three issues relate to the award of child support, and one issue relates to the award of attorney’s
fees. Husband contends the trial court, when determining the spousal support award to wife,
erred in: (i) accounting for certain needs of the parties’ children as an expense to wife;
(ii) accounting for wife’s income tax liability; (iii) assessing the parties’ standard of living
relative to wife’s needs; (iv) failing to reduce the monthly support amount for year one by an
amount equal to wife’s monthly imputed income beginning in year two; (v) making the support
permanent; and (vi) calculating husband’s income. As to the child support award, husband
contends the trial court erred in: (i) calculating the parties’ gross incomes; (ii) excluding the cost
of the children’s health insurance; and (iii) allocating the full cost of the children’s private school
tuition to husband. Finally, husband challenges the trial court’s award of attorney’s fees to wife.
A. Waiver
Husband states that the issues above were preserved for appeal in his motion to
reconsider and/or his written objections filed in response to the court’s letter opinion and
subsequent final decree. However, husband did not argue in those pleadings, as he does on
appeal, that when determining spousal support the trial court erroneously included as part of
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wife’s living expenses: (i) certain needs of the children, which he contends should have been
included in the assessment of child support; and (ii) wife’s income tax liability, which he
contends the trial court calculated without actually knowing wife’s income tax bracket. Nor did
husband assert in those pleadings that the trial court erroneously calculated the parties’ gross
incomes when determining child support.
Rule 5A:18 provides that “[n]o ruling of the trial court . . . will be considered as a basis
for reversal unless the objection was stated together with the grounds therefor at the time of the
ruling, except for good cause shown or to enable the Court of Appeals to attain the ends of
justice.” Furthermore, “[n]ot just any objection will do. It must be both specific and timely—so
that the trial judge would know the particular point being made in time to do something about it.”
Thomas v. Commonwealth, 44 Va. App. 741, 750, 607 S.E.2d 738, 742 (emphasis in original),
adopted upon reh’g en banc, 45 Va. App. 811, 613 S.E.2d 870 (2005); see also Edwards v.
Commonwealth, 41 Va. App. 752, 760, 589 S.E.2d 444, 448 (2003) (en banc); Torian v. Torian,
38 Va. App. 167, 185-86, 562 S.E.2d 355, 364-65 (2002). Rule 5A:18 thus bars our
consideration of the three above-stated issues in this appeal. Furthermore, the record does not
indicate any reasons to invoke the good cause or ends of justice exceptions to this rule.
B. Spousal Support
Our review of the spousal support award is governed by familiar principles. The trial
court has “broad discretion” in the decision to award spousal support. Miller v. Cox, 44
Va. App. 674, 679, 607 S.E.2d 126, 128 (2005) (citing Brooks v. Brooks, 27 Va. App. 314, 317,
498 S.E.2d 461, 463 (1998)). That includes the “nature, amount and duration” of the award.
Code § 20-107.1(E) (listing thirteen factors for consideration). In making that determination, the
court must consider all the factors listed in Code § 20-107.1(E); it is not required, however, “to
quantify or elaborate exactly what weight or consideration it has given to each of the statutory
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factors.” Woolley v. Woolley, 3 Va. App. 337, 345, 349 S.E.2d 422, 426 (1986). When the
court has duly considered those factors, “its determination ‘will not be disturbed except for a
clear abuse of discretion.’” Dodge v. Dodge, 2 Va. App. 238, 246, 343 S.E.2d 363, 367 (1986)
(quoting Thomasson v. Thomasson, 225 Va. 394, 398, 302 S.E.2d 63, 66 (1983)). Accordingly,
we will reverse the trial court only when its exercise of discretion is “‘plainly wrong or without
evidence to support it.’” Northcutt v. Northcutt, 39 Va. App. 192, 196, 571 S.E.2d 912, 914
(2002) (quoting Moreno v. Moreno, 24 Va. App. 190, 194-95, 480 S.E.2d 792, 794 (1997)).
Parties’ Standard of Living
Husband argues the trial court abused its discretion by awarding wife permanent spousal
support in an amount “far in excess” of her needs, in light of the “parties’ exceptionally frugal
lifestyle.” See Miller, 44 Va. App. at 684, 607 S.E.2d at 131 (“The purpose of spousal support
‘is to provide a sum for such period of time as needed to maintain the spouse in the manner to
which the spouse was accustomed during the marriage, balanced against the other spouse’s
ability to pay.’” (quoting Blank v. Blank, 10 Va. App. 1, 4, 389 S.E.2d 723, 724 (1990))). The
facts, however, negate this argument.
Husband asserts that wife’s “realistic need” for spousal support was $5,648 per month
“before inclusion of any employment income.” The trial court’s award of $15,000 per month for
the first year, and $13,500 per month thereafter, was, indeed, far more than the above-stated
figure. Contrary to husband’s assertion as to wife’s financial needs, however, the trial court
found that wife’s reasonable monthly living expenses exceeded $10,000 per month 1 and that,
after taxes, “[wife] will only have about $10,000 left over per month [from a support award of
$15,000 per month] to meet her needs.” The court further found that wife’s only other source of
1
The trial court reached this conclusion upon discounting wife’s claim of monthly living
expenses, in the amount of $13,682, after analyzing wife’s monthly income and expense
statement in detail, as set forth in the court’s letter opinion.
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income, for purposes of determining spousal support, was rental income in the amount of $807
per month from property she received under the parties’ equitable distribution agreement. These
two sources of income combined thus do not far exceed, if at all, wife’s reasonable monthly
living expenses, as found by the court. And, all of these findings of the trial court are supported
by evidence in the record.
Furthermore, Code § 20-107.1(E) did not require the trial court to fashion a support
award that simply met wife’s monthly living expenses, to the extent the award, along with wife’s
rental income, exceeded those expenses. See Miller, 44 Va. App. at 684-86, 607 S.E.2d at
131-32 (applying Code § 20-107.1(E)). When assessing the parties’ standard of living for
support purposes, a trial court may also account for “the parties’ pattern and custom of saving
and investing a . . . portion of their income.” Id. at 685-86, 607 S.E.2d at 131-32. Here, the
parties, consistent with their frugal lifestyle, saved and invested a large portion of their income.
Accordingly, to the extent the total of wife’s support award and rental income exceeded her
monthly living expenses, the award justifiably allowed her to both “meet her monthly living
expenses and . . . continue to save money and invest it.” Id. at 686, 607 S.E.2d at 132. And, in
fact, any such excess sums representing wife’s opportunity for saving and investing will be, at
best, modest, compared to what she was accustomed during the marriage.
Wife’s Imputed Income
Next, husband argues, in effect, that the trial court erred as a matter of law in failing to
reduce wife’s initial monthly support award in year one by an amount equal to her monthly
imputed income beginning in year two. The trial court awarded wife spousal support in the
amount of $15,000 per month in year one, imputed income to her beginning in year two in the
amount of $40,000 to $44,000 a year, or from $3,333 to $3,667 per month, and reduced her
spousal support, beginning in year two, from $15,000 to $13,500 per month, for a reduction of
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$1,500 per month. Husband contends the $1,500 reduction was erroneous, as it should have
been reduced by the imputed amount of between $3,333 and $3,667 per month. Husband,
however, cites no authority for requiring a dollar for dollar set-off between spousal support and
imputed income, nor is there such a requirement under Virginia law. See Code § 20-107.1.
Accordingly, we find no abuse of discretion in the manner in which the trial court
reduced wife’s spousal support award in year two in light of the income imputed to her at that
time. 2
Duration of Spousal Support Award
As to the duration of the spousal support award, husband argues the trial court erred by
awarding wife permanent support where the parties were married for a “relatively short duration”
and wife was employable. We disagree.
Code § 20-107.1(C) provides that “[t]he court, in its discretion, may decree that
maintenance and support of a spouse be made in periodic payments for a defined duration, or in
periodic payments for an undefined duration, or in a lump sum award, or in any combination
thereof.” See also Code § 20-107.1(E).
Here, the parties were married for twelve years. During that time, the parties’ two
children were born, reaching the ages of five and eight as of the time of the divorce. The parties’
insurance business, EIS, also grew substantially during those years. For the first four years of
marriage, husband sold insurance and wife “handled the administrative side of the business.”
After their first child was born, the parties agreed that wife would stay home with him, while still
2
Husband asserts additional arguments as to why the trial court erred in using the figure
of $1,500 per month for reducing the spousal support award based on the amount of wife’s
imputed income. Those issues were not preserved for appeal under Rule 5A:18, and we,
therefore, will not consider them.
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doing some of her administrative duties from home, and husband would continue to work in the
insurance business full time. This arrangement continued after the birth of their second child.
At the time of the divorce, husband acquired complete ownership of the insurance
business under the terms of the parties’ equitable distribution agreement. The trial court found
that husband’s income from the business, as sole owner, was approximately $73,000 per month.
The court also found that husband would receive an additional sum of approximately $4,000 per
month generated from an investment account and two of his rental properties. On the other hand,
wife’s earning capacity, after a period of retraining, would range from $40,000 to $44,000 per
year, and her only other financial resource, apart from spousal support, was her rental income in
the amount of $807 per month.
Under these circumstances, we cannot find the trial court abused its discretion in
permanently awarding spousal support to wife.
Husband’s Income
Husband next argues the trial court erred in calculating his net income from EIS in the
amount of approximately $73,000 per month. More specifically, husband contends that, when
the court calculated the amount of income of this Subchapter S corporation attributable to him, as
its sole stockholder, the court erred by failing to fully deduct EIS’s business expenses from the
company’s annualized gross income for 2006. Husband’s argument fails, as he presented no
evidence on this issue.
Code § 20-107.1(E)(1) provides that, in determining spousal support, the trial court shall
consider “the earning capacity, obligations, needs and financial resources of the parties.” In
Frazer v. Frazer, 23 Va. App. 358, 377-78, 477 S.E.2d 290, 299 (1996), we held that the
calculation of gross income for the determination of spousal support should be no different than
the calculation of gross income for purposes of determining child support, pursuant to Code
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§ 20-108.2(C). This statute defines gross income, in relevant part, as follows: “For purposes of
this section, ‘gross income’ means all income from all sources. . . . Gross income shall be
subject to deduction for reasonable business expenses for persons with income from self-
employment, a partnership, or a closely held business.” Code § 20-108.2(C).
Wife presented documentary evidence showing EIS’s commissions received, less
payments for insurance premiums, for a five-month period in 2006, resulting in an annualized net
income equal to approximately $73,000 per month, as the trial court found. Husband does not
challenge the calculation of that figure to this point. His argument is that the court failed to
reduce this amount by other business expenses of the company, which he contends were shown,
as cancelled checks, on the same bank statements wife introduced to establish EIS’s gross
income. Indeed, in his reply brief, husband states: “Inasmuch as [wife] submitted into evidence
copies of [husband’s] checks evidencing EIS’s business expenses there was no need for
[husband] to provide additional testimony concerning such expenses because documents speak
for themselves.” It was husband’s burden, however, to prove those expenditures were, in fact,
reasonable business expenses of EIS. See Code § 20-108.2(C). Absent such evidence, the trial
court accordingly found that “[husband] did not dispute that the Mercantile Bank statements for
EIS ([wife’s] Exhibits 80-82) show that it has had an average net income of approximately
$73,000 per month through June 2006.” Thus, on the record presented, we find no error in that
ruling.
C. Child Support
As with spousal support, the decision concerning child support “‘rest[s] within the sound
discretion of the trial court and will not be reversed on appeal unless plainly wrong or
unsupported by the evidence.’” Joynes v. Payne, 36 Va. App. 401, 424, 551 S.E.2d 10, 21
(2001) (quoting Smith v. Smith, 18 Va. App. 427, 433, 444 S.E.2d 269, 274 (1994)). In making
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that decision, the court must start by computing the presumptive monthly child support
obligation of a party pursuant to the statutory guidelines set forth in Code § 20-108.2.
Richardson v. Richardson, 12 Va. App. 18, 21, 401 S.E.2d 894, 896 (1991). The presumptive
obligation may then be rebutted by evidence pertaining to the enumerated factors listed in Code
§ 20-108.1(B), including, inter alia, “the ability of each party to provide child support, the best
interests of the child, the standard of living enjoyed by the family during the marriage, and other
factors ‘necessary to consider the equities for the parents and children.’” Ragsdale v. Ragsdale,
30 Va. App. 283, 295, 516 S.E.2d 698, 703-04 (1999) (quoting Code § 20-108.1(B)).
Cost of Health Insurance
In his opening brief, husband argues the trial court erred in failing to include the cost of
the children’s health insurance in its calculation of child support, referencing the court’s child
support guideline worksheet (prepared pursuant to Code § 20-108.2), which contained no entry
for that item. Husband also cites Code § 20-108.2(E), which provides, in relevant part: “Any
costs for health care coverage . . ., when actually being paid by a parent, to the extent such costs
are directly allocable to the child or children, and which are the extra costs of covering the child
or children beyond whatever coverage the parent providing the coverage would otherwise have,
shall be added to the basic child support obligation.” (Emphasis added). Despite the express
language of this statutory provision, however, husband does not cite to any evidence presented to
the trial court regarding the actual cost of health insurance for the children. In response, wife
points out in her brief that the only evidence on this issue was that health insurance for the family
was provided and paid for by EIS. Husband concedes this point in his reply brief, referring to
one line out of the 2005 tax return for EIS, showing the total cost of the company’s “employee
benefit programs,” as his only evidence on this issue.
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The trial court thus clearly had no basis for including the cost of health insurance for the
children in its child support calculations under Code § 20-108.2. Instead, the court ordered
husband to provide health insurance for the children “as a benefit of [husband’s] employment.”
See Code § 20-108.1(C) (authorizing the trial court, when determining child support, “to order a
party to provide health care coverage . . . for dependent children if reasonable under all the
circumstances”). Husband’s argument on this issue is, therefore, without merit.
Cost of Private School Tuition
Husband also argues the trial court erred when it failed to include the cost of the
children’s private school tuition ($2,157 per month) in its calculation of child support pursuant to
the Code § 20-108.2 guidelines, but, instead, allocated the full cost of tuition to him. A child’s
educational expenses are implicitly included in the presumptive amount of child support under
Code § 20-108.2. Solomond v. Ball, 22 Va. App. 385, 391, 470 S.E.2d 157, 159 (1996); Smith,
18 Va. App. at 435, 444 S.E.2d at 275. We have held, however, that under the rebuttal
provisions of Code § 20-108.1(B), “‘a parent may be required to pay for private education
expenses, even though such expenses exceed the guidelines, when there is a demonstrated need
for the child to attend private school and the parent has the ability to pay.’” Joynes, 36 Va. App.
at 424, 551 S.E.2d at 21 (quoting Ragsdale, 30 Va. App. at 295, 516 S.E.2d at 704). To impose
such an obligation, the trial court must make written findings of fact, as required by Code
§ 20-108.1(B), justifying the deviation. See Princiotto v. Gorrell, 42 Va. App. 253, 260-61, 590
S.E.2d 626, 630 (2004). Husband contends the court failed to do so here when ordering him to
pay all of the cost of tuition. We disagree.
The children’s need to attend private school at Loudoun County Day School was not in
dispute. As the trial court found, “[t]he parties agree that private school is necessary for the
children.” Furthermore, husband conceded at trial that he could afford to pay the school’s
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tuition. Thus, the court was only required to explain in writing why it was “unjust or
inappropriate” for wife to share in the cost of tuition. Code § 20-108.1(B). In its letter opinion,
the court reasoned that it would be “unfair” for wife to contribute to that cost, as her share would
have to be paid from her spousal support payments, whereas husband “can easily afford to pay
for it.” Because of the large disparity in the parties’ disposable incomes, we cannot say the trial
court abused its discretion in reaching that conclusion and ordering husband to pay the full cost
of tuition.
D. Attorney’s Fees Awarded by Trial Court
Finally, husband contends the trial court erred by awarding wife $60,000 in attorney’s
fees.
Whether to award attorney’s fees is a matter submitted to the
sound discretion of the trial court and is reviewable on appeal only
for an abuse of discretion. Given the unique equities of each case,
our appellate review steers clear of inflexible rules and focuses
instead on reasonableness under all the circumstances.
Smith v. Smith, 43 Va. App. 279, 289, 597 S.E.2d 250, 255 (2004).
In this case, the trial court found that wife had incurred attorney’s fees and costs of
approximately $130,000, and husband had incurred approximately the same amount. The court
further found that the “fees [were] not unexpected considering the issues involved and the assets
of the parties” and that “[w]ith significant separate assets [husband] is clearly in a better
economic condition than is [wife].” Under these circumstances, particularly in light of the
disparity of assets and incomes of the parties, we cannot say the trial court abused its discretion
in awarding wife $60,000 in attorney’s fees to be paid by husband, which represents less than
half of the total fees and costs she incurred.
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E. Attorney’s Fees Request on Appeal
Both parties request that this Court award attorney’s fees incurred on appeal. See
O’Loughlin v. O’Loughlin, 23 Va. App. 690, 695, 479 S.E.2d 98, 100 (1996) (holding appellate
attorney’s fees in domestic dispute may be awarded pursuant to Code § 20-99 upon specific
remand to trial court for determination of amount to be awarded).
“The rationale for the appellate court being the proper forum to
determine the propriety of an award of attorney’s fees for efforts
expended on appeal is clear. The appellate court has the
opportunity to view the record in its entirety and determine
whether the appeal is frivolous or whether other reasons exist for
requiring additional payment.”
McGinniss v. McGinniss, 49 Va. App. 180, 190-91, 638 S.E.2d 697, 702 (2006) (quoting
O’Loughlin, 23 Va. App. at 695, 479 S.E.2d at 100). On consideration of the record before us,
we decline to award either party attorney’s fees and costs on appeal.
III. CONCLUSION
For the above stated reasons, we affirm the judgment of the trial court.
Affirmed.
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