Presented by Ron J. Anfuso, CPA, ABV, CFF, CDFA, FABFA
The Trial Court’s Decision
Fred and Jill Smith were divorced in 1986. They had one child, for whom Fred was ordered to pay child support. Fred fell into arrears and, at the time of the Court of Appeals hearing, owed $190,000. His trial court request aimed to reduce his monthly payments due to disability that lowered his income. Instead, the County of Fresno’ s Department of Child Support Services (CSS), to whom the arrearages were due, increased his monthly payments to $500. This increase was attributable to Fred’s remarriage to his subsequent spouse whose annual earnings well exceeded $100,000. Thus, the court ordered arrearages of $500 per month based on Fred’s community property and his spouse’s income pursuant to Family Code §4008. This family code states, “The community property, the quasi-community property, and the separate property may be subjected to the support of the children in the proportions the court determines are just.”
Background and Appeals Court Ruling
The child support obligation was ordered when the parent’s marriage dissolved in 1986. In 2002, Fred filed a motion to “stay” the child support based on his assertion of 16 years of concealment. However, the court found no active concealment and ordered Fred to continue to pay $300 per month in child support, as well as $75 in arrearages, each month.
Fred argued that the court erred in modifying his monthly payment on child support arrearages by considering the earnings of his subsequent spouse under Family Code §4008, and failed to consider Family Code §910 and §911. Family Code §911(a) states: “The earnings of a married person during marriage are not liable for a debt incurred by the person’s spouse before marriage. After the earnings of the married person are paid, they remain not liable so long as they are held in a deposit account in which the person’s spouse has no right of withdrawal and are uncommingled with other property in the community estate, except property insignificant in amount.”
In May 2020, CSS made a motion to increase the payment amount on the arrearages from $75 per month to $500 per month. This was due to Fred’s current spouses’ earnings that could be used to pay the past support obligation. The Appeals Court agreed and applied Family Code §4008 and ordered Fred to pay $500 per month in arrearages.
Cases Leading Toward the Appeals Court Ruling
Family Code §3651 allows a support order to be modified or terminated at any time as the court determines necessary, except an amount that accrued before the date of the filing of the notice of motion or order to show cause to modify or terminate. However, amounts accrued previously are treated like a money judgment {In re Marriage of Perez (1995) 35 Cal.App.4th 77, 80, citing In re Marriage of Everett (1990) 220 Cal.App.3d 846, 854}.
According to Family Code §290, the trial court has discretion to determine the appropriate means of enforcing a judgment for child support. In exercising this discretion, the trial court can and should take the equities of the situation into account. {Keith G. v. Susanne H. (1980) 62 Cal.App.4th 853, 861-862}.
Although the court may not consider the subsequent spouse’s community income in calculating the child support obligation as cited on the previous page, the income of the subsequent spouse may be looked to in discharge of the child support {In re Marriage of Knowles (2009) 178 Cal.App.4th 35, 41 overruled on a different point in K.J. v. Los Angeles Unified School Dist. (2020) 8 Cal. 5th 875, 888, fn. 6}. Also, “In any hearing related to father’s child support obligations and his failure to meet them, father is on notice that his finances are subject to the trial court’s scrutiny” {In re Marriage of Furie (2017) 16 Cal.App.5th 816, 829}.
Furthermore, contrary to Fred’s contention, the fact that the judgment was for arrearages for support does not limit the court’s ability to consider the subsequent spouse’s income. “Child support obligation of a married person that does not arise out of the marriage shall be treated as a debt incurred before marriage, and the community estate is liable for a debt incurred by either spouse before or during marriage” {§915, subd. (a)}.
Fred’s interpretation would place regular debts over child support orders, which are the subject of strong public policy. {§ 4053, subd. (e); Estate of Casserley (2018) 22 Cal.Appl5th 824, 838.} “The liability of community property is not limited to debts incurred for the benefit of the community but extends to debts incurred by one spouse alone exclusively for his or her own personal benefit.”
If a delinquent debt for a chattel purchase may be satisfied by considering the debtor-spouse’s community property interest in the subsequent spouse’s earnings, a court can consider the community property interest in the spouse’s earnings to repay the debt owed for unpaid child support, an obligation of high priority {Lezine v. Security Pacific Fin. Services, Inc. (1996) 14 Cal.4th 56: 64; see also, In Re Marriage of Nassimi (2016) 3 Cal.App5th 667, 685). While the earnings of the subsequent spouse may not be considered in calculating an order for child support (In re Marriage of Knowles, supra, 178 Cal.App4th at p. 41), it was entirely proper to consider husband’s community property interest in the subsequent spouse’s earnings in modifying the payment amount of unpaid arrearages.