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Should ex-wife be allowed to "shirk" child-support duties?

 
 
Reply Wed 15 Jun, 2005 08:48 am
From the Wisconsin Supreme Court decision in Chen v. Warner
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Dr. Jane Chen and Dr. John Warner have three daughters, born on October 11, 1991, April 22, 1993, and July 12, 1995. In 1999, after an eighteen-year marriage, the parties divorced.

The parties entered into a marital settlement agreement, which was later incorporated into the judgment of divorce. The parties agreed to joint custody, equal physical placement, and no child support. At the time of the divorce in 1999, both parents were employed as medical doctors in Marshfield. Dr. Chen was earning $19,670 per month, which means an annual income of $236,040. Dr. Warner was earning $21,371 per month, which translates into an annual income of $256,452. 1

Prior to and after the divorce, both parties worked full time. After persistent and unsuccessful efforts to obtain a part-time schedule so that she could spend more time parenting, Dr. Chen voluntarily quit in May of 2000. By quitting, Dr. Chen gave up her substantial current income, contributions to her retirement plan, and job security. The undisputed testimony was that she was performing at a high level and was the administrator of a profitable department. If Dr. Chen had remained in her job, she would have made $410,175 in 2002.

At the time Dr. Chen quit in 2000, she was advised, based on market returns over the past fifty years, that she could expect approximately 10% per year income on her investments with a conservative investment plan. Since Dr. Chen had about 1.1 million dollars in savings, she hoped to earn about $110,000 per year. She estimated her budget at $7,000 per month or $84,000 per year.

Unfortunately, the stock market declined dramatically in 2001 and Dr. Chen's investment income likewise dropped dramatically. That year, her total income was $32,000. Thus, Dr. Chen began to invade her principal in order to meet expenses. At the same time, Dr. Chen investigated the possibility of returning to work part-time. She was unable to locate work in the Marshfield area, and she declined to pursue part-time work in communities beyond commuting distance.

In January of 2002, Dr. Chen filed a motion requesting that the divorce judgment be amended to order Dr. Warner to pay child support. At that time, Dr. Warner was earning $472,000 per year and his employer contributed an additional $73,000 per year to Warner's retirement plan. During an evidentiary hearing, Dr. Chen detailed her activities with the children. Those activities are set forth in detail in the discussion section below. Dr. Chen testified that her monthly budget was about $7,000. She asked the circuit court to order child support in the amount of $4,000 per month.

The circuit court determined that Dr. Warner could afford to pay child support and that Dr. Chen was not shirking. The court declined to use Dr. Chen's earning capacity and ordered Dr. Warner to pay $4,000 per month in child support.
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What should the result be? The wife here didn't even have full custody of the children, yet she quit a high-paying job and asked the courts to force her ex-husband to pick up the tab for full child-support payments.

For an interesting analysis of this case, click here.
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Type: Discussion • Score: 1 • Views: 2,697 • Replies: 16
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Thomas
 
  1  
Reply Wed 15 Jun, 2005 09:12 am
I haven't clicked the link to the interesting analysis yet, because I want to make up my own mind first.

Here is my immediate reaction to reading your initial post. I am assuming that a marital settlement agreement is a contract. Hence, from the description you quote, I gather that the couple had a contract that specified no child support. No child support means no child support. It doesn't make any difference to her contractual rights that Dr. Chen fell for a stock fraud and suffered the predictable consequences. Nor does it make any difference to Dr. Chen's obligations that Dr. Warner can afford to pay child support. He didn't have to, by the terms of the marital settlement agreement that Dr. Chen herself had signed. Consequently, I would overrule the circuit court's decision.
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roger
 
  1  
Reply Wed 15 Jun, 2005 09:29 am
Child support orders have always been subject to modification, and I'm not at all sure a parent can give away a child's rights. If not, the contract seems to have an illegal purpose and becomes invalid, at least in that respect.

Okay, I'm off to read the analysis.
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Noddy24
 
  1  
Reply Wed 15 Jun, 2005 10:51 am
What is in the best interest of the children? I'd guess Daddy paying child support.

Off to read the analysis.
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Thomas
 
  1  
Reply Wed 15 Jun, 2005 11:02 am
I just read the analysis, and I must confess I don't get it. The analysis is indeed interesting, and I'm sure it correctly describes the law for the case where the parties haven't contracted what their rights and obligations are. In this case, we do have a contract, signed by two consenting grown-ups who knew what they were doing, with no provisions too immoral to be enforced. Given that there appears to be a contract between the divorced parites, why must all this legal fanciness apply?
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joefromchicago
 
  1  
Reply Wed 15 Jun, 2005 12:05 pm
Thomas: All child support agreements are subject to change. This concept should be familiar to Europeans, who follow the rule of "rebus sic stantibus" in contracts. This rule allows parties to get out of their contractual duties in the event that there is a substantial change in conditions (for an analysis, see here). American law does not typically follow the rule of rebus sic stantibus, but that is, in effect, the rule that is followed with regard to child-support orders. So, in other words, a child-support agreement can always be changed by one party, as long as the court agrees.
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Thomas
 
  1  
Reply Wed 15 Jun, 2005 01:51 pm
joefromchicago wrote:
Thomas: All child support agreements are subject to change. This concept should be familiar to Europeans, who follow the rule of "rebus sic stantibus" in contracts.

Thanks. Actually, my knowledge of the law was narrowly limited to copyright and patent law, which are the branches I occasionally get in touch with in my job. It wasn't until discussions in online communities sparked my interest that I started reading and thinking about the law in general. Because these communities were all American, I know more about American law than about German law, which isn't saying much.

With your information in mind, I must say that Mrs Chen's reliance on the stock market for income looks fishy to me. First of all, there is no way you can expect a 10% return on a "conservative" investment portfolio when the market yield on government bonds is 6-7%, as it was in 2001. She made her budget on incorrect information, and I guess one would have to find out whether that was her fault or her investment consultant's. If it was her consultant's, I guess there is a chance she is not shirking.

The second thing I find fishy is that if you invest your money in the stockmarket, you get higher rates than in the bond or money markets in return for taking some extra risk. Heads you win, gain more than the market interest rate, and your principal increases. Tails you lose and maybe have to take some of your income by eating into your principal. Mrs Chen should have known about the risk when she signed the divorce agreement, and her ex-husband shouldn't have to bail her out when the risk materializes, since he doesn't share her profits when things go well. Mrs Chen has the right to play "heads I win, tails I lose" with her own money. She doesn't have the right to play "heads I win, tails my ex-husband loses", which is the game she now turns out to be playing.
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fishin
 
  1  
Reply Wed 15 Jun, 2005 02:47 pm
Re: Should ex-wife be allowed to "shirk" child-sup
joefromchicago wrote:

What should the result be? The wife here didn't even have full custody of the children, yet she quit a high-paying job and asked the courts to force her ex-husband to pick up the tab for full child-support payments.


The court should have told her to go pound sand and get back to work.

How many people believe that if he now quit his job to spend his time at home with the children (since he has them every other week just as she does) that the court would drop the requirement for him to provide her share of the child support??? I'd be willing to put $1K on the table that the courts would order him to go back to work and contiunue paying.
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sozobe
 
  1  
Reply Wed 15 Jun, 2005 02:54 pm
The husband has half custody, right? She should be able to find work for the time when she doesn't have custody. There is no such thing as absolutely no part-time jobs available -- maybe not what she wants, but SOMETHING. With the kind of skills she has, she should be able to open some sort of a consulting business if nothing else.

What doesn't sit right with me is her getting that $4,000 a month -- and then just sitting around and doing nothing in particular for the half of the time her ex-husband has custody.

(Can someone give me $4,000 a month? Please?)
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fishin
 
  1  
Reply Wed 15 Jun, 2005 03:24 pm
sozobe wrote:
The husband has half custody, right? She should be able to find work for the time when she doesn't have custody. There is no such thing as absolutely no part-time jobs available -- maybe not what she wants, but SOMETHING. With the kind of skills she has, she should be able to open some sort of a consulting business if nothing else.


The article said that they alternate weeks which may complaicate things but I agree - there are possibilities for her. If she was worth $400K+/year to some company for doing research she should be able to find some sort of counsulting job that pays at least $100K/year part time.

Quote:

(Can someone give me $4,000 a month? Please?)


When you find someone willing to do that let them know that I'm willing to settle for $2K/month! Very Happy
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joefromchicago
 
  1  
Reply Wed 15 Jun, 2005 03:48 pm
Thomas wrote:
She doesn't have the right to play "heads I win, tails my ex-husband loses", which is the game she now turns out to be playing.

It certainly seems that way. It also seems that, in this scenario, the advantage goes to the first person to quit his/her job. If, for instance, the ex-husband decided, less than a year after the divorce was final, to quit his job "in order to spend more time with his children" (every other week), then he could have forced his ex-wife to continue working and to subsidize his lifestyle choice. Frankly, that doesn't strike me as very fair or as a very good policy.
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fishin
 
  1  
Reply Wed 15 Jun, 2005 04:18 pm
lol I just read the full decision and it is even more laughable than I thought.

This woman lives with another adult in her home (who earned a grand total of $8K in 2001!) and the $4000 she was awarded was based on her statement that she needs $5000/month to maintain/operate the home ($5000/month is the complete budget for the home)

Not only is he paying child support for the children, he is paying for her live-in lover as well! WTF is with that???

It is also interesting that the court determined that it was "reasonable" that she not return to work partly because he earned enough to cover her share of child support. What kind of screwed up reasoning is that? What they are saying is that she doesn't have to live up to her obligations because someone else has money.
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FreeDuck
 
  1  
Reply Wed 15 Jun, 2005 04:59 pm
I'm having a hard time forming an opinion on this one. On the one hand, it certainly seems like the best thing for the kids is for her to stay home -- at least while they are with her. There's more to parental responsibilities than money. But, the husband doesn't have this option now. Where are the kids for the week that he has them when he has to go to work? Is he paying her AND childcare?

And I'm off to read the analysis.
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Lady J
 
  1  
Reply Wed 15 Jun, 2005 05:08 pm
That is just totally wrong. As I have heard it said before, it looks like she got the gold mine and he got the shaft. Dr. Warner WAS/IS supporting his kids...is appears to be some stupid convoluted way of turning "child support" into "alimony" without calling it such and giving mom a free ride.
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ossobuco
 
  1  
Reply Wed 15 Jun, 2005 08:39 pm
Man, I wish I'd asked for alimony...
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princesspupule
 
  1  
Reply Thu 16 Jun, 2005 04:19 am
Re: Should ex-wife be allowed to "shirk" child-sup
fishin' wrote:
joefromchicago wrote:

What should the result be? The wife here didn't even have full custody of the children, yet she quit a high-paying job and asked the courts to force her ex-husband to pick up the tab for full child-support payments.


The court should have told her to go pound sand and get back to work.

How many people believe that if he now quit his job to spend his time at home with the children (since he has them every other week just as she does) that the court would drop the requirement for him to provide her share of the child support??? I'd be willing to put $1K on the table that the courts would order him to go back to work and contiunue paying.


I think the court would do just that based upon their definitions of shirking and reasonable behavior to follow. In the wife's case,
Quote:
At the time Dr. Chen quit in 2000, she was advised, based on market returns over the past fifty years, that she could expect approximately 10% per year income on her investments with a conservative investment plan. Since Dr. Chen had about 1.1 million dollars in savings, she hoped to earn about $110,000 per year. She estimated her budget at $7,000 per month or $84,000 per year.
http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=wi&vol=wisctapp2\\2004\\03-0288&invol=1 The husband could as easily find an expert on market returns to advise him what he could expect, based upon trends over the past 50 years and act accordingly and the child support would have to go down as well. There is no mandate to continue w/any career you find unfulfilling, and no court in America who would claim that careers are more important to have than parenting, if you can presume to afford to live off your investments.
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squinney
 
  1  
Reply Thu 16 Jun, 2005 07:07 am
Okay, without reading the analysis...

The Courts concern is with the parents financial responsibility for the children. The original contract doesn't matter. The Courts responsibility is basically to see to it that the children do not become financially reliant on the State. (ie foodstamps, medicaid, etc) The ourt doesn't care about live-in-lovers, because the lover has no financial responsibility to the children.

A Court certainly CAN order someone to go to work to provide for their children. I've seen it many times, and I've seen re-appearences that landed the offender in jail for not getting a job if he couldn't show substantial effort had been made to be employed and meet is obligation.

Gonna read the analysis now.
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