In RE MARRIAGE OF JARMAN v. Welter
2006 WI App 54, 711 N.W.2d 705, 289 Wis. 2d 857 (2006)
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Rule of Law:
A court's child support determination, including the inclusion or exclusion of overtime income, must be a discretionary decision based on the specific facts of each case, not a general policy without exceptions. When deviating from statutory percentage standards, a court must articulate its specific reasoning and consider factors related to fairness to the child or parties.
Facts:
- Larry Welter and Carolyn Rae Welter were married on October 3, 1998, and had one child together.
- Larry worked as a custodian.
- Larry regularly earned overtime income from his employment.
- The family court commissioner responsible for child support modifications had a known general policy of not including overtime income when calculating child support obligations.
- Larry's overtime work was voluntary.
- Larry had other children in addition to the child with Carolyn Rae Welter.
Procedural Posture:
- Larry Welter and Carolyn Rae Welter were divorced on May 3, 1999.
- Larry Welter was initially ordered to pay child support as a percentage of his gross income.
- On January 29, 2002, Larry Welter's child support payment was converted from a percentage of gross income to a fixed dollar amount based on his 2001 income.
- On April 21, 2005, a modification hearing was held before a family court commissioner, who ordered a new support obligation based on Larry Welter's 2004 income, but excluded his overtime income as a general policy.
- Eau Claire County Child Support Agency appealed the family court commissioner's decision to the circuit court.
- The circuit court upheld the family court commissioner's decision to exclude Larry Welter's overtime income, stating that the commissioner's general policy was correct.
- Eau Claire County Child Support Agency, as appellant, appealed the circuit court's order to the Court of Appeals of Wisconsin, with Larry Welter as respondent-respondent.
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Issue:
Does a circuit court err by upholding a family court commissioner's decision to exclude a parent's overtime income from a child support calculation based on a general policy, rather than exercising discretion informed by the specific facts and legal standards of the case?
Opinions:
Majority - Cane, C.J.
Yes, a circuit court errs by upholding a family court commissioner's decision to exclude a parent's overtime income from a child support calculation based on a general policy, because child support determinations require the individualized exercise of discretion informed by the specific facts and legal standards of the case. Child support determinations are within the trial court's discretion and are reversed only for an erroneous exercise of discretion. Wisconsin law mandates child support obligations be a fixed sum based on a percentage of gross income, which includes all salary and wages, per WIS. ADMIN. CODE § DWD 40.02(13)(a)1. While courts may deviate from the percentage standard if its application would be unfair to the child or any party, this deviation must be based on a consideration of sixteen statutory factors, and the court must articulate its specific reasons for finding unfairness and for the modification. Overtime income is unambiguously part of salary and wages and is not statutorily excluded from gross income. The family court commissioner and the circuit court erroneously exercised their discretion by applying a general policy of excluding overtime income, rather than making a case-by-case determination based on the facts of record and the applicable legal standards. The matter must be remanded for a proper exercise of discretion considering the parties' specific circumstances.
Analysis:
This case underscores the fundamental principle that judicial discretion in child support matters requires individualized assessment of facts rather than the application of rigid, universal policies. It clarifies that gross income, for the purpose of child support calculations, generally includes overtime pay, and any deviation from this standard must be specifically justified by statutory factors and explicit reasoning. The ruling serves as a crucial reminder to lower courts and court commissioners that blanket rules are an erroneous exercise of discretion when the law demands a tailored, fact-specific analysis. This precedent guides future cases by mandating that courts meticulously articulate their rationale when including or excluding income components like overtime, thereby promoting consistency, fairness, and adherence to statutory mandates in family law proceedings.
