In Re The Marriage Of: Amber Schubert, Res. And Victor Schubert, App. ( 2015 )

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION ONE
In the Matter of the Marriage of No. 71119-9-1
No. 72592-1-1
CJ'I
AMBER SCHUBERT, consolidated with
No. 72593-9-I
i
Respondent, CO
and
VICTOR SCHUBERT, UNPUBLISHED OPINION
Appellant. FILED: August 3, 2015
Verellen, J. — Victor Schubert appeals the amended decree of dissolution and
the order on modification of maintenance and child support. He contends that because
he was unemployed at the time of trial and modification, the trial court abused its
discretion in awarding maintenance and imputing income to him for purposes of the
child support award. Because Victor did not provide us with an adequate record on
appeal, we affirm the trial court's fact-based discretionary rulings.
Victor further contends that the trial court erred in not including Amber Schubert's
imputed income in the child support worksheets. Because he raised this issue for the
first time on appeal, his argument fails. Victor also argues that the trial court erred in an
upward deviation of child support. But he does not establish that this rounding up was a
deviation as contemplated by RCW 26.19.035(4). Lastly, he contends that the trial
court must use the lodestar method in determining appropriate attorney fees. But
because the primary considerations for an award of attorney fees in dissolution actions
No. 71119-9-1 & No. 72592-1-1/2
are equitable, trial courts are not always required to apply the lodestar method.
Accordingly, we affirm.
FACTS
Victor Schubert married Amber Schubert in California on April 1, 2000.1 Victor
worked as a patent attorney there from 1992 until January 2009, when the parties
relocated to Washington so that Victor could pursue an attorney position at Intellectual
Ventures, where he earned more than $500,000 per year. Amber has been out of the
work force for almost all of their marriage to raise their two children.
The Schuberts separated on December 1, 2011, and Amber petitioned for
dissolution on March 28, 2012. On April 30, 2013, Victor was laid off from his position
at Intellectual Ventures. He received 16 weeks of severance pay, plus payment of
medical insurance benefits for the family through August 2013.
Victor had not yet found employment at the time of trial from June 3, 2013
through June 10, 2013. The main issues at trial were property distribution,
maintenance, child support, and attorney fees. The Schuberts agreed to the terms of a
parenting plan, which designated Amber as the primary residential parent of the
children.
The trial court awarded Amber $648,936 of community property (54.24 percent of
the community assets) and $26,644 of separate property. It awarded Victor $547,413 of
community property (45.76 percent of the community assets) and $434,724 of separate
property.
1 To avoid confusion, we refer to the Schuberts by first name.
No. 71119-9-1 & No. 72592-1-1/3
The parties disagreed as to spousal maintenance. The trial court awarded
Amber $5,500 in monthly maintenance for a period of 48 months commencing
September 1, 2013, plus an additional 25 percent of any annual income in excess of
$225,000 for a period of eight years. The trial court found that:
[Victor] has historically had very significant income and there is no reason
to expect that he will not continue to earn at a significant level. Upon
finalization of this matter, [Victor's income will allow him [to] support
himself in a manner similar to that enjoyed during the marriage while
continuing to maximize his retirement accounts and increase his assets.
[Amber], on the other hand, will not, even after obtaining a degree in the
healthcare field, have earnings approaching those of [Victor]. [Amber],
and the children who are primarily with her, will live a far more modest life
given the limits of [Amberj's income.[2]
The trial court acknowledged that Victor's "niche as a patent attorney [was] very
narrow" due to changes in the industry making his prospects not as plentiful as they
were in the past.3 The court found he was diligently searching for employment and that
"[Victor] has an earning ability of $225,000 per year, which is much less than he earned
at [Intellectual Ventures]."4
Regarding child support, the trial court found Amber underemployed in a
healthcare position. Because she lacked sufficient work history on which to base her
income, the trial court imputed income to her under RCW 26.19.071 (6)(e) at a median
level based on census data. The trial court found Victor unemployed and imputed
monthly income to him under RCW26.19.171(6)(b) based on his historical income
averaging over $500,000 annually for the past five years and having been in excess of
2 Clerk's Papers (CP) at 569. (No. 71119-9-1).
3 Id, at 571.
4 Id.
No. 71119-9-1 & No. 72592-1-1/4
$250,000 since the parties married in 2000. The trial court ordered him to pay $2,000 in
monthly child support. In doing so, the court increased the child support award above
the standard calculation of $1,703 per month based on its finding that Victor "has the
ability to pay this amount and the children are in need of this level of support."5 Finally,
the court awarded Amber attorney fees in the amount of $50,000, finding that Victor had
the ability to pay a portion of her fees.
On February 28, 2014, Victor petitioned for modification of maintenance and child
support. On September 11, 2014, the trial court entered an order granting Victor's
petition for modification of the amended decree of dissolution. It found that Victor was
making a diligent job search, but had not found employment. It acknowledged that
Victor's employment future was being affected by a shift toward filling patent attorney
jobs with less experienced attorneys and persons with master of business
administration degrees. The trial court reduced maintenance to $2,500 per month
commencing March 2014, noting Amber's need versus Victor's ability to pay, as well as
Amber's irresponsible use of the maintenance she had received. It did not grant Victor's
petition for modification of child support.
Victor appeals both the initial decree and the order on modification.
ANALYSIS
The premise of Victor's primary argument on appeal is that the trial court
abused its discretion in its initial and modified award of maintenance. He contends
that because he was unemployed and diligently searching for employment, Amber
should not have been awarded maintenance. But Victor provided us with only three
5 Id. at 615.
No. 71119-9-1 & No. 72592-1-1/5
and one-half hours of the record from a five-day trial. The record is inadequate to
review the merits of Victor's contentions.6
"The party seeking review has the burden of perfecting the record so that this
court has before it all of the evidence relevant to the issue[s]."7 Although Victor claims
that "[t]he verbatim transcript regarding employment for both parties was provided for
review on appeal,"8 the only verbatim reports of proceedings provided to this court
concern the testimony of Amber and expert witnesses regarding her employment
prospects. It is undisputed that Victor testified at trial regarding his past employment
and future prospects, but the record before us contains none of this testimony.9
Although Victor contends that the missing record is related to rulings he has not
challenged on appeal, the issues he has raised require a full record regarding his
economic circumstances, including his past earnings and prospects for future income.
The fact-based trial court decisions challenged by Victor on appeal reveal how the
inadequate record hampers our review.
First, as to his challenge to the initial and modified maintenance awards, both are
reviewed for an abuse of the trial court's broad discretion.10 "The only limitation on [the]
amount and duration of maintenance under RCW 26.09.090 is that, in light of the
6 Story v. Shelter Bay Co.. 52 Wash. App. 334, 345, 760 P.2d 368 (1988).
7 Olmsted v. Mulder, 72 Wash. App. 169, 183, 863 P.2d 1355 (1993); RAP 9.2(b).
8 Appellant's Reply Br. at 5.
9 Victor's declaration includes minimal information about his earnings and no
details about his prospects.
10 In re Marriage of Luckev, 73 Wash. App. 201, 209, 868 P.2d 189 (1994); In re
Marriage of Spreen, 107 Wash. App. 341, 346, 28 P.3d 769 (2001).
No. 71119-9-1 & No. 72592-1-1/6
relevant factors, the award must be just.'"11 "Those factors include, but are not limited
to: (1) the financial resources of the party seeking maintenance; (2) the time needed to
acquire education necessary to obtain employment; (3) the standard of living during the
marriage; (4) the duration of the marriage; (5) the age, physical and emotional condition,
and financial obligations of the spouse seeking maintenance; (6) and the ability of the
spouse from whom maintenance is sought to meet his or her needs and financial
obligations while providing the other spouse with maintenance.12
Victor specifically criticizes the trial court for its "speculation" as to his future
income.13 He also contends that the trial court failed to adequately consider his ability
to meet his own financial needs and obligations as required by RCW 26.09.090(f).
The trial court clearly found that Victor had the present ability to pay
maintenance. The evidence before the court included his severance package, the
disproportionate award of assets,14 and potential employment income the court was
confident he would soon earn. On the current record, Victor cannot demonstrate an
abuse of discretion as to the amount of the initial or modified maintenance awards.1516
11 In re Marriage of Valente. 179 Wash. App. 817, 821, 320 P.3d 115 (2014) (quoting
In re Marriage of Bulicek. 59 Wash. App. 630, 633, 800 P.2d 394 (1990)).
12 id at 821-22.
13 Appellant's Reply Br. at 9.
14 Victor received $306,557 more in total assets than Amber. See In re Marriage
of Crosetto, 82 Wash. App. 545, 559, 918 P.2d 954 (1996) (trial court was entitled to
consider property division in its determination of maintenance and to consider
maintenance in its property division).
15 Relying on In re Marriage of Drlik, 121 Wash. App. 269, 87 P.3d 1192 (2004),
Victor further argues that "[t]he trial court should have at least suspended the
maintenance obligation pending review/modification upon the earlier of his employment
or nine months, whichever was sooner." Appellant's Br. at 14 (No. 72592-I). But in Drlik,
the court held merely that the trial court had authority to temporarily, but not indefinitely,
suspend the husband's maintenance obligation because he was stricken with brain
No. 71119-9-1 & No. 72592-1-1/7
Second, Victor also challenges the use of "a formulaic escalation clause [in the
maintenance award] that did not relate to the need of [Amber],17 as well as the duration
of the maintenance award. Use of an uncapped escalation clause can be troublesome,
but we need a more complete record to evaluate this issue in the entire economic and
employment context. Moreover, Victor fails to cite any relevant authority pertaining to
escalation clauses in maintenance awards and instead relies entirely on authority
involving child support orders. As to the duration of the maintenance award, we need a
record which includes all the testimony regarding the full economic background of both
spouses.
Third, Victor challenges the imputation of income for purposes of the child
support award. Specifically, he argues that the child support order was an abuse of
discretion based upon Victor's involuntary unemployment. Without citing any precise
authority, Victor relies on his conclusory statement that "[i]t is contradictory for the court
to find that [he] is laid off and diligently searching for work, thus involuntarily
unemployed, and then apply RCW 26.19.071 (6)(b) and impute income."18 And without
an adequate record on appeal to analyze the trial court's findings, Victor does not
demonstrate any abuse of discretion or error of law in imputing income to him.
cancer and currently lacked the ability to pay and might regain the ability to pay. Drlik
does not suggest that a trial court is compelled to make such a temporary adjustment.
16 Rekhi v. Olason. 28 Wash. App. 751, 753, 626 P.2d 513 (1981) (when an appeal
is brought on a short record without a complete verbatim report of the proceedings, the
trial court's findings of fact are accepted as verities).
17 Appellant's Br. at 1 (No. 71119-9-1).
18 Appellant's Br. at 26 (No. 72592-1-1); see Cowiche Canyon Conservancy v.
Boslev. 118 Wash. 2d 801. 809. 828 P.2d 549 (1992); State v. Elliott, 114Wn.2d6, 15,785
P.2d440 (1990); Saunders v. Lloyd's of London. 113 Wash. 2d 330, 345, 779 P.2d 249
(1989).
No. 71119-9-1 & No. 72592-1-1/8
Fourth, Victor further contends that "[t]he trial court imputed income to Amber in
the Findings of Fact, and it is an error of law to not include that imputed income in the
child support worksheets."19 But based on the record before us, it appears he is raising
this issue for the first time on appeal.20 Thus, Victor's argument fails.
Fifth, Victor argues that "[t]he upward deviation of the child support obligation
above the standard calculation without written findings when the father is involuntarily
unemployed is error."21 But under RCW 26.19.020, "[w]hen combined monthly net
income exceeds twelve thousand dollars, the court may exceed the presumptive
amount of support set for combined monthly net incomes of twelve thousand dollars
upon written findings of fact." Victor does not establish that the upward rounding off of
child support was a "deviation" as contemplated by RCW 26.19.035(4).22
Sixth, Victor argues that "[t]he trial court erred in failing to deduct the costs of
sale from the parties' Newcastle, Washington home."23 He contends that "[bjased on
the court's orders of maintenance and child support. .. when he had no income, [he]
had no choice to but [sic] sell the Newcastle home immediately."24 A trial court may
only deduct the costs of sale if a sale is imminent and necessary.25 In his trial brief,
Victor stated that "[w]hen the market recovery is sufficient for him to recover his
19 Appellant's Reply Br. at 21.
20 RAP 2.5(a).
21 Appellant's Br. at 28 (No. 72592-1-1).
22 Leslie v. Verhev. 90 Wash. App. 796, 803-04, 954 P.2d 330 (1998).
23 Appellant's Br. at 2 (No. 71119-9-1).
24 ]cL at 30-31.
25 In re Marriage of Stenshoel. 72 Wash. App. 800, 810, 866 P.2d 635 (1993).
8
No. 71119-9-1 & No. 72592-1-1/9
separate property investments, he will sell the residence."26 Absent a more complete
record of the trial, we do not know if Victor's testimony was consistent with this
statement. Accordingly, Victor does not establish that it was an abuse of discretion to
deny a deduction for the costs of sale.
Finally, Victor challenges the attorney fees award, asserting that "[t]he court
made no finding of the reasonableness of [Amber's] fees."27 This court reviews an
award of attorney fees for abuse of discretion.28 "The party challenging the trial court's
decision bears the burden of proving the trial court exercised its discretion in a way that
was 'clearly untenable or manifestly unreasonable.'"29
Victor contends that the trial court "must use the lodestar method of determining
an appropriate award of attorney fees."30 However, in dissolution actions, the primary
considerations for an award of attorney fees "are equitable," and thus, trial courts are
not required to apply the lodestar method.31
"The overriding considerations are the need of the party requesting the fees, the
ability to pay of the party against whom the fee is being requested, and the general
equity of the fee given the disposition of the marital property."32 Under RCW 26.09.140,
26 Clerk's Papers at 82-83.
27 Appellant's Br. at 36 (No. 71119-9-1).
28 Estrada v. McNultv, 98 Wash. App. 717, 723, 988 P.2d 492 (1999).
29 Crosetto. 82 Wash. App. at 563 (quoting In re Marriage of Knight. 75 Wn. App.
721,729, 880 P.2d 71 (1994)).
30 Appellant's Br. at 33 (No. 71119-9-1).
31 Knight, 75 Wash. App. at 730.
32 In re Marriage of Van Camp. 82 Wash. App. 339, 342, 918 P.2d 509 (1996).
No. 71119-9-1 & No. 72592-1-1/10
[t]he court from time to time after considering the financial resources of
both parties may order a party to pay a reasonable amount for the cost to
the other party of maintaining or defending any proceeding under this
chapter and for reasonable attorneys' fees or other professional fees in
connection therewith, including sums for legal services rendered and costs
incurred prior to the commencement of the proceeding or enforcement or
modification proceedings after entry of judgment.
"In considering the financial resources of both parties, the court balances the needs of
the requesting party against the other party's ability to pay."33
Here, the trial court found that Amber "testified and presented evidence that she
was in need of attorney's fees, having incurred $93,213 . . . and having only been able
to pay $21,073 of those fees."34 It also found that Victor's "attorney fees had been paid
in full since [the] inception of the case and those fees totaled more than $48,000."35
Thus, the court concluded that Victor "has the ability to pay a portion of [Amber]'s
attorney's fees" and that an award "in the amount of $50,000 is appropriate under the
circumstances."36 Victor fails to satisfy his burden of establishing that the court
exercised its discretion in a way that was "clearly untenable or manifestly
unreasonable." Accordingly, it was within the trial court's discretion to award Amber
attorney fees.
Amber also requests attorney fees on appeal "based on her need and [Victor's
ability to pay under RCW 26.09.140."37 This court has the discretion to order a party to
33 Leslie. 90 Wash. App. at 805.
34 Clerk's Papers at 572 (No. 71119-9-I).
3514
36 jd,
37 Respondent's Br. at 35 (No. 71119-9-1).
10
No. 71119-9-1 & No. 72592-1-1/11
pay the other party's attorney fees associated with the appeal of a dissolution action.38
"In exercising our discretion, we consider the arguable merit of the issues on appeal and
the parties' financial resources."39 Amber provided a declaration of financial need
demonstrating her need for attorney fees, but Victor failed to timely file his own financial
affidavit as required by RAP 18.1(c).40 Accordingly, we award reasonable attorney fees
for this appeal to Amber, provided she complies with RAP 18.1(d).
WE CONCUR:
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38 RCW 26.09.140.
39 In re Marriage of C.M.C.. 87 Wash. App. 84, 89, 940 P.2d 669 (1997).
40 RAP 18.1(c) ([E]ach party must serve upon the other and file a financial affidavit
no later than 10 days prior to the date the case is set for oral argument or consideration
on the merits .... Any answer to an affidavit of financial need must be filed and served
within 7 days after service of the affidavit.").
11