February 2, 2017- Colette C. Jury v. Victor R. Jury, No. 34,257 cons. 34,564

IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
Opinion Number: __________
Filing Date: 	February 2, 2017
NOS. 34,257 and 34,564 (consolidated)
COLETTE C. JURY,
Petitioner-Appellant,
v.
VICTOR R. JURY,
Respondent-Appellee.
APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY
Deborah Davis Walker, District Judge
Caren I. Friedman
Santa Fe, NM
Bishop Law P.C.
Julie Bishop
Albuquerque, NM
for Appellant
Kerry Kiernan, P.C.
Kerry Kiernan
Albuquerque, NM
for Appellee

1Respondent also filed a motion to modify the 2010 decree, which was denied.
Respondent does not appeal this denial.
OPINION
WECHSLER, Judge.
{1} 	This case arises from the district court’s denial of Petitioner Colette C. Jury’s
motion to modify the child support decree (the 2010 decree) that resulted from the
dissolution of the marriage between Petitioner and Respondent Victor R. Jury. After
considering evidence of the parties’ updated financial information, the district court
ruled that the 2010 decree was not subject to modification because neither party
demonstrated material and substantial changes in circumstances affecting the welfare
of the children. 1
{2} 	Petitioner claims that the district court’s ruling resulted from its erroneous
determination of the parties’ gross monthly incomes and, by extension, child support
obligations. Respondent argues that, even if the district court miscalculated the
parties’ gross monthly incomes, its determination that no material and substantial
changes in circumstances affecting the welfare of the children occurred is dispositive.
{3} 	District courts have discretion to deviate from the child support guidelines,
NMSA 1978, § 40-4-11.1 (2008), as provided in NMSA 1978, Section 40-4-11.2
(1989). However, such discretion does not extend to the process of calculating the

2
parties’ gross monthly incomes. Calculation of the parties’ gross monthly incomes
must conform to the child support guidelines or precedential appellate court
interpretation of the child support guidelines. Therefore, to the extent that the district
court improperly deviated from the child support guidelines in calculating the parties’
gross monthly incomes, we reverse and remand for recalculation.
{4} 	We recognize, however, that recalculation alone does not resolve the central
issue raised on appeal. Petitioner asks this Court to conclude that changes in income
indicated by the parties’ updated financial information entitled her to a modification
of the 2010 decree as a matter of law. Because the testimony and evidence offered at
trial does not support a modification at common law, we are unable to so conclude.
However, if recalculation of the parties’ gross monthly incomes results in a deviation
upward of more than twenty percent of the existing child support obligation, Petitioner
is entitled to “a presumption of material and substantial changes in circumstances” as
provided by NMSA 1978, Section 40-4-11.4(A) (1991).
{5} 	The district court’s deviation from the child support guidelines in calculating
the parties’ gross monthly incomes potentially deprived Petitioner of a presumption
of material and substantial changes in circumstances to which she was entitled as a
matter of law. If, on remand, the district court’s recalculation of the parties’ gross
monthly incomes results in a presumption of material and substantial changes in

3
circumstances under Section 40-4-11.4, the district court shall reconsider whether
Petitioner is entitled to a modification of the 2010 decree in light of this opinion.
{6} 	Petitioner additionally argues that the district court lacked evidence to support
its prospective reduction of the amount of child support awarded in the 2010 decree.
Respondent argues that the reduction was appropriate but agrees that the district
court’s failure to articulate how it determined the recalculated amount requires
remand. Because Respondent agrees that error occurred, we decline to provide
additional legal analysis. On remand, the district court shall determine whether, and
to what extent, the 2010 decree was subject to modification given the changes in
circumstances occurring on or around June 1, 2015.
{7} 	Because our reversal and remand undermines the district court’s rationale for
awarding certain attorney fees, such awards to Respondent in the amounts of $15,000
and $750 are reversed. However, we affirm the district court’s award of attorney fees
arising from post-judgment proceedings in the amount of $1,500 to Respondent.
BACKGROUND
A. 	The 2010 Decree
{8} 	On September 11, 2006, Petitioner filed a petition to dissolve her marriage to
Respondent. The district court’s February 22, 2010 judgment and order finalized
numerous matters between the parties, including the child support obligation. At the

4
time of the 2010 decree, the parties had two minor children of the marriage, ages
thirteen (Son) and nine (Daughter). Respondent derived the majority of his income
from his employment at, and shareholder interest in, Summit Electric Co., Inc.
(Summit Electric) and his shareholder interest in Jury & Associates, LLC (Jury &
Associates). Petitioner did not work outside the home.
{9} 	Substantial testimony and evidence related to the parties’ income and financial
resources was offered at trial. Exhibits 16 and 16A, which were filed as supplemental
exhibits to the appellate record on July 14, 2016, appear to have featured prominently
in the district court’s 2010 determination. Exhibits 16 and 16A contained statements
of Respondent’s gross income, cash received, income taxes paid, and net income for
the years 2001 through 2009. Applying the financial information in these exhibits, the
district court concluded that Respondent had an “earning capacity” of $750,000 per
year. In its ruling from the bench, the district court explained that $750,000 was not
Respondent’s actual gross annual income, but instead represented a conscious
deviation downward. While discussing specific evidence of Respondent’s then-current
year earnings, the district court stated “I think, if anything, the $750[,000] is low.”
{10} 	After arriving at an annual income of $750,000, the district court subtracted
$120,000 paid by Respondent to Petitioner in spousal support. It then divided the total
amount by twelve, resulting in a gross monthly income for Respondent of $52,500.

2Prior to the 2008 amendment of Section 40-4-11.1, the child support guidelines
provided a formula for the calculation of basic child support to an infinite amount of
combined gross monthly income. See § 40-4-11.1(K) (1995) (providing that “[f]or
gross monthly income greater than $8,000, multiply gross by the following
percentages: 11% [for one child,] 16.1% [for two children,] 18.8% [for three children]
. . .”). Application of the pre-amendment formula to the parties’ combined gross
monthly income results in $10,707 per month.
5
{11} 	The district court calculated Petitioner’s income by combining her spousal
support award and $4,000 per month of imputed earning capacity. It then divided the
total amount by twelve, resulting in a gross monthly income for Petitioner of $14,000.
{12} 	Having calculated the parties’ combined gross monthly income to be $66,500,
the district court calculated the percentage of combined gross monthly income. It
credited Respondent with seventy-nine percent of the parties’ combined gross monthly
income and Petitioner with twenty-one percent of the parties’ combined gross monthly
income.
{13} 	The district court then determined the basic child support obligation to be
$10,707. Although the child support guidelines in effect in February 2010 did not
allow for basic calculation of a combined gross monthly income of $66,500, the
district court elected to apply the historical formula to determine the basic child
support amount. 2
{14} 	The district court also calculated the total child support obligation, the retained
portion based upon custody, and the parties’ individual child support obligations. The

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custodial calculation was based upon the children residing with Petitioner fifty-five
percent of each month and residing with Respondent forty-five percent of each month.
The district court calculated Petitioner’s monthly obligation to be $1,518 and
Respondent’s monthly obligation to be $6,978. It reconciled these obligations to result
in $5,460 owed by Respondent to Petitioner each month. It reduced this amount by
twenty-one percent of additional expenses, including the cost of the children’s health
care insurance and private school tuition. After these reductions, Respondent’s total
monthly child support obligation was $4,872. In accordance with Section 40-4-
11.4(B), the district court ordered that the parties exchange updated financial
information each year. The merits of the 2010 decree are not on appeal or subject to
reconsideration by this Court.
B. 	The 2014 Denial of the Parties’ Motions to Modify the 2010 Decree
{15} 	Respondent provided updated financial information to Petitioner on November
14, 2011. On December 6, 2011, Petitioner filed a motion to modify the 2010 decree
based upon a “deviation upward of greater than twenty percent of the existing child
support obligation[.]” Respondent filed a motion in opposition on April 16, 2013, as
well as his own motion to modify the 2010 decree on January 7, 2014. He based his
motion to modify the 2010 decree upon allegations of substantial changes in
circumstances to the custodial time sharing and changes in the parties’ incomes.

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{16} 	On January 30, 2012, the district court appointed James W. Francis, CPA, as
a Rule 11-706 NMRA expert in the case. He prepared a report that (1) analyzed the
parties’ 2011 gross incomes and (2) updated Exhibit 16A from the November 2009
trial with Respondent’s financial information from 2009 through 2011.
{17} 	The trial was conducted between April 30, 2014 and May 2, 2014. Francis
testified as to his conclusions about the district court’s previous determination of
Respondent’s gross income, stating,
[In 2009] the judge . . . took an average of the prior eight or nine years
[of] after-tax cash income, averaged those out, and it came up to about
$750,000. . . . The court then . . . subtracted from that $750,000,
$120,000, which was the spousal support that [Respondent] was paying,
$10,000 a month. That left a balance of $630,000, which the court
divided by twelve, and said that [Respondent’s] monthly income for
child support purposes was $52,500. So, if the court were to follow the
exact same model . . . [Respondent’s] income for 2011, using the
deviations that I described, would be $2,785,363. But that’s just for
2011.
{18} 	Francis additionally testified that Respondent’s 2011 gross income was
comprised of salary from Summit Electric and pass-through earnings proportionate
to his ownership shares in Summit Electric and Jury & Associates. On direct
examination, counsel for Petitioner implied that the 2010 decree resulted from an
improper application of the child support guidelines because the district court
deducted income taxes paid from Respondent’s gross income. Francis replied that
pass-through income from certain corporate entities is, sometimes, subtracted from

8
gross income by courts as cash not received by the party. On cross-examination,
Francis agreed with counsel for Respondent that S-corporations frequently pass
through profits to shareholders for the purpose of paying income taxes.
{19} 	The parties testified as to the welfare of their children, essentially agreeing that
the children lack for nothing and are well provided for by both parents. The parties
also agreed that Son, of his own volition, currently resided with Respondent full-time,
but disputed the date on which this transition occurred. Based upon motions filed
during 2012, the district court ruled that Son ceased residing with Petitioner in late
2011.
{20} 	The district court denied both parties’ motions to modify the 2010 decree. As
rationale for its denial, the district court offered the following statements:
I did the best job I could [in 2009]. And I think it’s very interesting to
note that, according to the report that you both stipulated into evidence
and you both essentially agreed with, number-wise, that [Respondent’s]
income after deduction for the tax payment was $711,562 [in 2009], and
I put his income at $750,000. I think, all things considered, that was
pretty close. I estimated that [Petitioner’s] earning capacity, in addition
to her spousal support, was about $4,000, based on the testimony that I
heard and I think it’s still at that point.
. . . .
And I said at the time, I don’t want to see you back in a year, or two
years. I knew that [Respondent] . . . by all accounts, he’s a very capable
businessman. He runs a very successful company. The income fluctuates
up and down, through the last eleven years. There is a huge variation

9
from year to year. So I was well aware at the time that I could pick a
number and then the next year the numbers would be twice that much.
. . . .
Now, under the statute, and there was a quote from Spingola [v.
Spingola, 1978-NMSC-045, 91 N.M. 737, 580 P.2d 958,] the court can
only modify child support if there is a material and substantial change in
circumstances which would, since the last order was entered, which
would warrant the modification of the child support.
. . . .
I picked what I thought was a reasonable number [in 2009]. If
[Petitioner] didn’t like that number, she should have appealed at the time.
I can’t now go back and fix that number.
. . . .
[Petitioner] did argue that [Respondent’s] income has increased. Maybe,
maybe not. If you look at, you know, we don’t even have the number for
this year. I don’t have the numbers for 2013. I don’t even have the
numbers for 2012; 2011, the numbers were good. And I’m looking . . .
at the numbers that were calculated based on the method that was
recently approved by the Court of Appeals in the Clark [v. Clark, 2014-
NMCA-030, 320 P.3d 991] decision[.]
. . . .
If I look at 2011, it’s one thing; if I look at the last three years, it’s
something; if I look at the last ten, it’s one thing; if I look at the last
eleven, it’s something totally different. So I don’t know if his income has
gone up, because of . . . again, when a judge hears numbers from zero to
a million, I have discretion to pick any number I want in that range. And
there 	is 	evidence 	to 	support 	my 	decision. 	I 	thought 	under 	the
circumstances a ten-year average was appropriate. So I arrived at income
figure for [Respondent’s] earning capacity at $813,463.

10
. . . .
If you take . . . the deduction for the spousal support, that brings it down
to $693,463; that puts it at $57,788 a month, as opposed to $52,500 a
month[.] . . .
That’s not to me something that is statistically significant. It’s not a
twenty percent change in his income. If we use the old worksheets,
which I really don’t want to do because there are no worksheets that
apply to this current situation.
. . . .
But if we put this number on the old guidelines, there wouldn’t be a
twenty percent change in that bottom baseline child support amount.
. . . .
So basically, what I’m finding is that neither side carried his or her
burden of proof to show that there’s been a change, a substantial change
materially affecting the welfare of the children. So we don’t get to the
cap issue. We don’t get to the Spingola [, 1978-NMSC-045] analysis.
Both motions are denied. The child support remains the same.
{21} 	The 	district 	court 	reiterated 	its 	rationale 	and 	the 	income 	calculation
methodology in a subsequent hearing on May 16, 2014. That hearing resulted in an
order, entered on June 10, 2014, which provided that (1) a hearing on attorney fees
would be held on August 28, 2014 and (2) the parties must submit proposed findings
of fact and conclusions of law as to all appellate issues within fifteen days after the
hearing on attorney fees. Petitioner orally indicated that she would not appeal.

11
C. 	Attorney Fees and Findings of Fact and Conclusions of Law
{22} 	The August 28, 2014 hearing on attorney fees resulted in an award of $15,000
to Respondent. In support of its award, the district court stated, “[Petitioner’s] initial
motion was to increase child support. She did not get an increase in child support.
[Respondent] prevailed on that issue. That’s how I can decide [that Respondent is
entitled to attorney fees].” Additionally, the district court’s ruling included a reduction
in Respondent’s child support obligation, effective June 1, 2015, based on Son’s
pending eighteenth birthday and graduation from high school. Both parties indicated
that they would not appeal.
{23} 	On September 30, 2014, the district court held a hearing to present the final
order. During this hearing, Petitioner raised a perceived inconsistency between the
district court’s oral rulings on May 2, 2014 and August 28, 2014 and requested a
deadline for findings of fact and conclusions of law. The district court refused, stating,
“We’re done. I’ve already ruled. You’ve already stated on the record that nobody’s
appealing. We can’t at this point.” The district court entered separate orders on the
merits and for attorney fees.
{24} 	On October 24, 2014, Petitioner filed a motion to reconsider numerous issues,
including the district court’s (1) denial of the motion to modify the 2010 decree on the
merits; (2) sua sponte reduction of Respondent’s child support obligation effective

12
June 1, 2015; (3) award of attorney fees to Respondent; and (4) refusal to allow the
submission of findings of fact and conclusions of law. The district court held a hearing
on Petitioner’s motion to reconsider on October 29, 2014. This hearing resulted in a
partial grant and partial denial of Petitioner’s motion. With respect to findings of fact
and conclusions of law, the district court ruled that “[b]oth sides waived their right to
submit findings and conclusions under Rule [1-052 NMRA] and pursuant to my [June
10, 2014] order.” The district court awarded $750 in attorney fees to Respondent for
defending the motion.
{25} 	Petitioner filed a timely appeal to this Court. During the pendency of this
appeal, Respondent made efforts to depose Petitioner in accordance with Rule 1-069
NMRA and to gather information related to enforcement of the district court’s award
of attorney fees from other sources. Petitioner filed various motions seeking protection
from Respondent’s enforcement efforts. On February 2, 2015, the district court
awarded Respondent $1,500 in attorney fees for costs incurred in defending
Petitioner’s motions and filing related motions. Petitioner appealed this award of
attorney fees. Petitioner’s two appeals were consolidated by order of this Court.
STANDARD OF REVIEW
{26} 	Child support determinations are made at the discretion of the district court and
are reviewed for abuse of discretion. Styka v. Styka, 1999-NMCA-002, ¶ 8, 126 N.M.

13
515, 972 P.2d 16. That discretion, however, “must be exercised in accordance with the
child support guidelines.” Id. A district court abuses its discretion if “it applies an
incorrect standard, incorrect substantive law, or its discretionary decision is premised
on a misapprehension of the law.” Klinksiek v. Klinksiek, 2005-NMCA-008, ¶ 4, 136
N.M. 693, 104 P.3d 559 (internal quotation marks and citation omitted). In
determining whether a deviation from the child support guidelines resulted from a
mispprehension of law, we apply de novo review. Id.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
{27} 	As an initial matter, we address the notable absence of findings of fact and
conclusions of law supporting the district court’s ruling. Neither Petitioner nor
Respondent requested or submitted proposed findings of fact or conclusions of law
prior to the district court’s deadline of September 12, 2014. Rule 1-052(A) provides
that “[i]n a case tried by the court without a jury, . . . the court shall enter findings of
fact and conclusions of law when a party makes a timely request.” As a general rule,
a party’s failure to make such a request within ten days, or as otherwise ordered by the
district court, operates as a waiver of the right to specific findings of fact and
conclusions of law. See Rule 1-052(B); Wagner Land & Inv. Co. v. Halderman, 1972-
NMSC-019, ¶¶ 7, 11, 83 N.M. 628, 495 P.2d 1075. However, the absence of findings
of fact and conclusions of law does not operate as a bar to appellate review. See Rio

14
Grande Sun v. Jemez Mountains Pub. Sch. Dist., 2012-NMCA-091, ¶ 22, 287 P.3d
318 (“Rule 1-052 was rewritten in 2001, and the current version omits reference to
preservation of error as this is a matter for the appellate rules.” (internal quotation
marks and citation omitted)). Petitioner argues on appeal that the district court’s
misapprehension of Section 40-4-11.1 resulted in its conclusion that the 2010 decree
was not subject to modification and asserts that the 2010 decree is subject to
modification as a matter of law. This Court may review Petitioner’s arguments on the
record before us.
APPLICATION OF THE CHILD SUPPORT GUIDELINES AND RELATED
STATUTES
A. 	Determination of Child Support Obligations
{28} 	The codification of child support guidelines arose in response to a lack of
uniformity of support awards across the country. Charles J. Meyer et al., Child
Support Determinations in High Income Families—A Survey of the Fifty States, 28 J.
Am. Acad. Matrim. Law. 483, 484-85 (2016). In 1988, our Legislature enacted
Section 40-4-11.1, which significantly limited the discretion of the district courts in
making determinations of child support obligations. See Perkins v. Rowson, 1990-
NMCA-089, ¶ 13, 110 N.M. 671, 798 P.2d 1057 (“[I]t is apparent that Section
[40-4-]11.1 is a substantial change in the substance of the law, and a significant
restriction of the trial court’s formerly broad discretion in determining the amount of

15
a parent’s support obligation.”); see also Leeder v. Leeder, 1994-NMCA-105, ¶ 6, 118
N.M. 603, 884 P.2d 494 (“[T]he guidelines are presumed to provide the proper
amount of child support[.]”). The scope of this limitation is expressed in Section 40-4-
11.1(A), which states, in pertinent part, “[i]n any action to establish or modify child
support, the child support guidelines . . . shall be applied to determine the child
support due . . . Every decree or judgment of child support that deviates from the
guideline amount shall contain a statement of the reasons for the deviation.”
(Emphasis added.)
{29} 	While “deviation from the child support guideline amounts set forth in Section
40-4-11.1” is permitted, no such deviation is authorized with respect to the district
court’s calculation of the parties’ gross monthly incomes. Section 40-4-11.2 (emphasis
added); see § 40-4-11.1(C)(2), (K) (describing the inputs and methodology used to
calculate gross income for purposes of determining child support obligations). Section
40-4-11.1(C)(2) defines “gross income” as “income from salaries, wages, tips,
commissions, bonuses, dividends, severance pay, pensions, interest, trust income,
annuities, capital gains, social security benefits, workers’ compensation benefits,
unemployment insurance benefits, disability insurance benefits, significant in-kind
benefits that reduce personal living expenses, prizes and alimony or maintenance
received[.]” Certain sources of income, such as means-tested public assistance and

16
child support payments received for other children, are exempted from gross income.
Section 40-4-11.1(C)(2)(a). Certain expenditures, such as spousal and child support
actually paid, result in a reduction of gross income. Section 40-4-11.1(C)(2)(c), (d).
{30} 	In circumstances in which income is derived from proprietorship of a business
or joint ownership of a partnership or closely held corporation, “ ‘gross income’
means gross receipts minus ordinary and necessary expenses[.]” Section 40-4-
11.1(C)(2)(b). As a practical matter, this Court is “more concerned with a parent’s
actual cash flow than we are with income as represented on tax returns.” Major v.
Major, 1998-NMCA-001, ¶ 5, 124 N.M. 436, 952 P.2d 37. An example of this “actual
cash flow” principle arose in Clark, in which this Court concluded that “Subchapter-S
corporation funds actually distributed to the shareholder-spouse must be attributed to
the shareholder-spouse as [gross] income” unless the distribution “was used for
business purposes or to offset the payment [of] income taxes resulting from any K-1
allocations.” 2014-NMCA-030, ¶ 12. The rationale underlying Clark—that cash
passed to a shareholder for the express purpose of paying income taxes is not
“available to apply toward the support of [the] children”—is consistent with our child
support jurisprudence. Major, 1998-NMCA-001, ¶ 9. To a certain extent, allowing for
the deduction of taxes paid on K-1 allocations muddles the definition of “gross
income” in Section 40-4-11.1(C). However, taxes paid on W-2 earnings are not

17
deducted from gross income for purposes of calculating child support obligations. See
Boutz v. Donaldson, 1999-NMCA-131, ¶ 25, 128 N.M. 232, 991 P.2d 517 (“We can
discern no clear intent in the statute to consider hypothetical tax consequences of
reported income before it is inserted into the child support tables. From a survey of the
statutory language used in defining ‘gross income,’ we see that the Legislature has
included all kinds of income without any express regard for the varying effect of
taxes.”).
{31} 	Just as Section 40-4-11.1(C) provides the sources of, and allowable deductions
from, gross income, Section 40-4-11.1(K) provides temporal direction for calculating
gross income, stating, “Use current income if steady. If income varies a lot from
month to month, use an average of the last twelve months, if available, or last year’s
income tax return.” (Emphasis added.) Our appellate interpretations are consistent
with the statutory language. See Spingola, 1978-NMSC-045, ¶ 13 (holding that a child
support determination “requires that evidence of [an obligor’s] current financial
resources be fully considered” (emphasis added)); Boutz, 1999-NMCA-131, ¶ 10
(holding that it was error to use “income from other than the year in question”). While
no New Mexico appellate court has expressly considered the appropriateness of multi-
year averaging, other jurisdictions allow multi-year averaging when self-employment
or business income is subject to fluctuation. See, e.g., In re Marriage of Garrett, 785

18
N.E.2d 172, 178 (Ill. App. Ct. 2003) (affirming the district court’s use of a three-year
average of self-employment income as a physician); Roberts v. Roberts, 924 So. 2d
550, 553 (Miss. Ct. App. 2005) (affirming the district court’s use of a three-year
average of self-employment income from pharmaceutical sales); Gress v. Gress, 743
N.W.2d 67, 74-75 (Neb. 2007) (affirming the district court’s use of a three-year
average of self-employment income from farming and stating “it appears that both
here and elsewhere, a [three]-year average tends to be the most common approach in
cases where a parent’s income tends to fluctuate [and] even among the jurisdictions
which permit an average of more than [three] years, courts appear reluctant to use
more than a [five]-year average”); see also Zimin v. Zimin, 837 P.2d 118, 123 (Alaska
1992) (affirming the district court’s use of current self-employment income from
commercial fishing and stating “although income averaging is clearly appropriate
[when income fluctuates], a ten-year average is generally not a reliable indicator of
an obligor parent’s current earning capacity”).
{32} 	After calculating each party’s gross monthly income, that amount is combined
and entered into Section 40-4-11.1(K), Worksheet B. Using the parties’ combined
gross monthly income and each party’s percentage of combined income, the district
court must determine the basic monthly support by reference to the basic child support
schedule. Section 40-4-11.1(K). The basic child support schedule provides the

3 Relevant legal scholarship indicates that enacted child support guidelines
provide a presumptive minimum amount of child support in high-income scenarios.
See Laura W. Morgan, The High-Income Parent, Child Support Guidelines
Interpretation & Application § 8.07 (2016) (“[W]here the guidelines do not contain
an express formula, some states use a presumption that the highest amount provided
for in the guidelines is the correct amount. . . . [T]hese states allow deviation. Thus,
a court must first presumptively determine support as the highest amount provided
in the guidelines, but the court may deviate upward from the presumed amount based
on the specific needs of the child[.]” (emphasis added)).
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presumptive amount of child support for combined gross monthly income up to
$30,000. Section 40-4-11.1(A), (K). Unlike other jurisdictions, our Legislature has not
specifically authorized district courts to use discretion in calculating child support
obligations when gross monthly income exceeds the maximum amount on the basic
child support schedule. Cf. Colo. Rev. Stat. § 14-10-115(7)(E) (2016) (“The judge
may use discretion to determine child support in circumstances where combined
adjusted gross income exceeds the uppermost levels of the schedule of basic child
support obligations[.]”); see also Meyer, supra, at 500 n.68 (noting that “New Mexico
does not have any high income instruction”). In the absence of direction from our
Legislature with respect to the calculation of child support obligations when the
parties’ combined gross monthly income exceeds $30,000, we presume that a district
court retains broad discretion.3 See Peterson v. Peterson, 1982-NMSC-098, ¶ 9, 98
N.M. 744, 652 P.2d 1195 (“Child support determinations are an area of the law in
which trial court are allowed broad discretion.”). As such, if the parties’ combined

20
gross monthly income exceeds $30,000, the district court must determine the basic
monthly support after considering
[(1)] the total financial resources of both parents, including their
monetary obligations, income, and net worth; [(2)] the life-style the
children would be enjoying if the father and the mother were together
and the non-custodial parent had his [or her] present income level; and
[(3)] whether the income, surrounding financial circumstances, and
station in life demonstrated an ability by the father [or mother] to provide
additional advantages to [their] children above their actual needs.
Padilla v. Montano, 1993-NMCA-127, ¶ 36, 116 N.M. 398, 862 P.2d 1257 (citing
Spingola, 1978-NMSC-045, ¶ 24).
{33} 	After calculating the basic monthly support, whether using the basic child
support schedule or otherwise, the district court must continue to apply Worksheet B
of Section 40-4-11.1 to determine (1) the amount transferable from the obligor to the
obligee and (2) any reduction of this amount based upon the obligee’s contribution to
health and dental premiums, work-related child care, and extraordinary costs
including, but not limited to, extraordinary medical, dental, and counseling costs,
extraordinary educational expenses, and transportation and communication expenses
necessary to implement custodial arrangements. Section 40-4-11.1(H), (I), (K). The
previously determined percentage of combined income figures prominently in this
series of calculations. See § 40-4-11.1(K) (applying the percentage of combined

21
income to determine each party’s share of the basic monthly support and each party’s
share of additional payments and expenses).
{34} 	Numerous precedential opinions hold that a district court’s failure to calculate
gross income as per Section 40-4-11.1(A) and Section 40-4-11.1(K) is error. For
example, in Boutz, the obligor’s gross income included dividend earnings from
investments that fluctuated from year to year. 1999-NMCA-131, ¶ 9. At trial, the
district court rejected evidence indicating the amount of dividend earnings in the first
half of 1996 and instead used dividend earnings from 1995. Id. This Court concluded
that the use of 1995 dividend earnings was error. Id. ¶ 10. In so holding, we noted that
“[t]he [district] court did not explain its . . . reliance on what was arguably stale
information” and that the error was compounded by the district court’s use of 1996
income calculations for the obligee. Id. ¶¶ 9-10; see also id. ¶ 10 (“Calculating [the
parties’] dividend earnings by different methods violates one of the express goals of
the statute: making awards more equitable[.]” (alteration, internal quotation marks,
and citation omitted)). Similarly, in Klinksiek, the district court excluded rental
income from the obligee’s gross income. 2005-NMCA-008, ¶ 2. This Court reversed,
holding that Section 40-4-11.1(C)(2) requires calculation of “income from any
source.” Klinksiek, 2005-NMCA-008, ¶¶ 7, 12. Additionally, in Tedford v. Gregory,
the petitioner filed for retroactive child support from her alleged natural father. 1998-

22
NMCA-067, ¶ 1, 125 N.M. 206, 959 P.2d 540. The district court awarded petitioner
$50,000 but failed to explain how it calculated that amount. Id. ¶ 32. This Court
reversed, holding that “the [district] court should first determine both the mother’s and
the father’s income during the applicable time periods [and s]uch findings should be
made before applying any deviation from the standard child support guidelines.” Id.
¶¶ 31, 34.
{35} 	In summary, Klinksiek and Boutz hold that a district court may not deviate from
Section 40-4-11.1 in calculating the parties’ gross incomes. Klinksiek, 2005-NMCA-
008, ¶ 7; Boutz, 1999-NMCA-131, ¶ 10. Boutz additionally implies that the district
court must, to the degree possible, calculate the parties’ gross incomes during the
same time period. 1999-NMCA-131, ¶ 10. Clark and Boutz outlined the intersection
between gross income and income taxes in the child support context. Clark, 2014-
NMCA-030, ¶ 12; Boutz, 1999-NMCA-131, ¶ 25. And Tedford clarified that gross
income must be calculated prior to any allowable deviations from the child support
guidelines. 1998-NMCA-067, ¶ 31. These holdings, along with the plain language of
the relevant statutes, guide our analysis of the present case.
B. 	Deviation From the Child Support Guidelines
{36} 	Section 40-4-11.2 provides that “[a]ny deviation from the child support
guideline amounts set forth in Section 40-4-11.1 . . . shall be supported by a written

23
finding in the decree, judgment or order of child support that application of the
guidelines would be unjust or inappropriate.” (Emphasis added.) As we have already
clarified, it is error to deviate from the child support guidelines in calculating the
parties’ gross incomes except as authorized by statute or appellate case law. However,
it is also error to deviate from the child support guidelines in any manner without
providing written justification for such deviation. See § 40-4-11.2; Tedford, 1998-
NMCA-067, ¶ 33 (“[W]e conclude that the trial court erred . . . in failing to specify
the reasons for the trial court’s decision in deviating from the child support
guidelines.”). As indicated in Section 40-4-11.2, acceptable reasons for deviation
include circumstances in which “application of the guidelines would be unjust or
inappropriate” as indicated by “substantial hardship in the obligor, obligee or subject
children[.]”
C. 	Modification of Child Support Obligations
{37} 	A district court may modify a child support obligation upon a showing of
material and substantial circumstances subsequent to the adjudication of the pre-
existing child support order. Section 40-4-11.4(A). As indicated by our Supreme
Court in Spingola, a petitioner must demonstrate a substantial change in circumstances
affecting the welfare of the children to justify a modification. See 1978-NMSC-045,
¶ 16 (“The issue before the trial court on a petition to modify the amount of child

24
support is whether there has been a showing of a change in circumstances. The change
must be substantial, materially affecting the existing welfare of the child, and must
have occurred since the prior adjudication where child support was originally
awarded.”). This requirement is referred to as “the traditional changed circumstances
requirement” 	and 	governs 	the 	vast 	majority 	of 	child 	support 	modification
determinations. Perkins, 1990-NMCA-089, ¶ 4.
{38} 	However, in 1990, our Legislature enacted Section 40-4-11.4, which provided
“a court may modify a child support obligation without showing material and
substantial change in circumstances if application of the child support guidelines in
Section 40-4-11.1 . . . would result in a deviation upward or downward of more than
twenty percent of the existing child support obligation.” (Emphasis added.) This Court
limited Section 40-4-11.4 (1990), at least impliedly, in Perkins, which held that “a
showing of a substantial change in circumstances is still required before the trial court
can modify a parent’s child support obligation.” 1990-NMCA-089, ¶ 3. After Perkins,
our Legislature amended Section 40-4-11.4 to provide that “[t]here shall be a
presumption of material and substantial changes in circumstances if application of the
child support guidelines in Section 40-4-11.1 . . . would result in a deviation upward
or downward of more than twenty percent of the existing child support obligation[.]”
Section 40-4-11.4(A) (1991). This Court has subsequently viewed Section 40-4-11.4

25
to supersede Perkins and to abrogate the traditional changed circumstances doctrine
under the circumstances contemplated. See Boutz, 1999-NMCA-131, ¶ 2 (concluding
that a proposed increase of more than twenty percent in the father’s child support
obligation constituted a change in circumstances “sufficient in an amount to justify a
court-ordered modification of child support”).
{39} 	We conclude that Boutz is consistent with the legislative intent embodied in
Section 40-4-11.4. “[T]he Legislature, as the policy-making branch of government,
can alter or abrogate the common law[.]” City of Albuquerque v. N.M. Pub. Regulation
Comm’n, 2003-NMSC-028, ¶ 16, 134 N.M. 472, 79 P.3d 297. Our Legislature has
twice enacted legislation designed to limit the application of the traditional changed
circumstances requirement in favor of determining a petitioner’s entitlement to a
modification based upon “a deviation upward or downward of more than twenty
percent of the existing child support obligation[.]” Compare § 40-4-11.4 (1990), with
§ 40-4-11.4 (1991); see also Rhinehart v. Nowlin, 1990-NMCA-136, ¶ 56, 111 N.M.
319, 805 P.2d 88 (Hartz, J., concurring in part and dissenting in part) (“If the
[L]egislature has spoken on a matter of public policy, the judiciary should respect that
policy in matters of statutory interpretation and common-law jurisprudence.”). As
such, we reiterate that, in cases in which application of the parties’ updated financial
information to the child support guidelines results in a deviation upward or downward

26
of more than twenty percent of the existing child support obligation, the party seeking
modification is entitled to a presumption of material and substantial changes in
circumstances justifying a modification.
{40} 	Of course, legal presumptions are generally rebuttable, and we agree with
Respondent that the Spingola factors provide analytical support for denying a motion
to modify child support even when application of Section 40-4-11.4(A) results in a
presumption of material and substantial changes in circumstances justifying a
modification. See Spingola, 1978-NMSC-045, ¶ 24 (providing considerations relevant
to determinations of child support obligations, including “what life-style the children
would be enjoying if the father and mother were not divorced and the non-custodial
parent had [their] level of income” and the “ability of [a parent] to furnish additional
advantages to his [or her] children above their actual needs”). For example, if the
updated financial information resulted in the obligor’s child support obligation
increasing by twenty percent, but the obligee failed to offer any additional evidence
justifying modification, the statutory presumption could be rebutted.
{41} 	However, Spingola also outlined principles that govern the use of judicial
discretion on a motion to modify child support. These principles include “judicious
consideration, honesty, common sense, and regular procedure for arriving at an
equitable solution for all[.]” Id. ¶ 20 (emphasis added). This language indicates that

27
determinations of child support obligations are intended to be equitable as between the
parties. See DeTevis v. Aragon, 1986-NMCA-105, ¶ 26, 104 N.M. 793, 727 P.2d 558
(holding that issues of child support are subject to “a fair balancing of the equities in
light of the best interests and welfare of the children”); see also § 40-4-11.2 (allowing
deviation from the child support guidelines if application “would be unjust or
inappropriate”).
{42} 	In summary, the child support guidelines limit the need for judicial discretion
in the vast majority of child support determinations. However, Section 40-4-11.4
requires that the district court use discretion when faced with a statutory presumption
of material and substantial changes in circumstances. Spingola limits this discretion.
A child support determination must “arriv[e] at an equitable solution for all[.]”
Spingola, 1978-NMSC-045, ¶ 20. Therefore, when faced with a presumption of
material and substantial changes in circumstances arising under Section 40-4-11.4, a
district court does not have discretion to deny modification of the existing child
support obligation if doing so would perpetuate inequities as between the parties.
THE DISTRICT COURT PROCEEDINGS AND RULING
A. 	The Basic Child Support Amount
{43} 	Although the issue is not expressly raised on appeal, the district court’s
calculation of $10,707 as the basic amount of child support appears legally sound

28
under the circumstances. Both parties testified at trial that the children are well-
provided for. Petitioner testified that she “did not need more than [the adjusted amount
of] $4,872” to provide for the children. In cases in which the parties’ combined gross
monthly income exceeds $30,000, the district court has discretion to calculate the
appropriate basic child support amount, including by reference to the historical
formula 	as 	occurred 	here. 	Peterson, 	1982-NMSC-098, 	¶ 	9 	(“Child 	support
determinations are an area of the law in which trial court are allowed broad
discretion.”).
B. 	Spingola Analysis
{44} 	In light of the testimony described immediately above, a Spingola analysis does
not trigger a modification of the 2010 decree as a matter of law. We therefore disagree
with 	Petitioner’s 	argument 	that 	Respondent’s 	“enhanced 	financial 	position”
necessarily requires modification of the 2010 decree.
{45} 	Spingola holds that a “dramatic increase” in the obligor’s income may imply
a substantial change in circumstances and trigger a modification of child support.
1978-NMSC-045, ¶¶ 13-14. In so concluding, our Supreme Court noted that “[i]t is
ridiculous to assume that the welfare of the children would not have improved
considerably . . . [if] the father’s income had doubled.” Id. ¶ 13. However, in Spingola,
the father’s gross annual income increased from $42,000 to $87,000 over a period of

29
three years. Id. ¶ 3. This increase in income resulted in a potential increase in the
father’s monthly child support obligation from $1,000 to $3,000. Id.
{46} 	Neither the level of income nor the proposed modification of the existing child
support obligation in Spingola is analogous to the present case. In 1978, an additional
$2,000 per month in child support certainly would have positively impacted the
welfare of the parties’ three children. This potential for positive impact is emphasized
in the second and third Spingola factors that direct district courts to consider the
“welfare” of the children in the context of (1) “what life-style the children would be
enjoying if the father and mother were not divorced and the [father] had his present
level of income” and whether (2) “the father demonstrates an ability . . . to furnish
additional advantages to his children above their actual needs[.]” Id. ¶ 24. We are,
however, unable to conclude that these factors weigh against Respondent in this case.
Respondent’s gross income appears to have increased substantially from the $750,000
calculated for purposes of the 2010 decree. But Respondent provides child support,
after adjustments, of $4,872 each month for his two children. Petitioner testified at
trial that her children “have far more privilege than the majority of children.” Both she
and Respondent testified as to the luxuries afforded to the children with respect to
housing, education, travel, vehicles, and other material possessions. In Spingola, the
father argued at trial and on appeal that his obligation to support his children extended

30
only to “necessities.” Id. ¶ 21. That is not the case here. Instead, we conclude that a
Spingola 	analysis 	does 	not 	favor 	Petitioner’s 	position 	on 	appeal 	under 	the
circumstances of this case. Cf. Downing v. Downing, 45 S.W.3d 449, 456 (Ky. 2001)
(“[N]o child, no matter how wealthy the parents, needs to be provided more than three
ponies.”).
C. 	Calculation of Gross Income
{47} 	Although the district court has discretion to determine $10,707 as the basic
child support amount, our review of the proceedings and record evidence reveals that
the district court improperly deviated from the child support guidelines in its
calculation of the parties’ gross incomes for 2011. This miscalculation, which
potentially deprived Petitioner of the “presumption of material and substantial changes
in circumstances” provided by Section 40-4-11.4, constitutes an abuse of discretion
requiring reversal and remand.
{48} 	We discern three distinct issues with the district court’s calculation of the
parties’ gross incomes: (1) the subtraction of taxes paid from Respondent’s gross
income; (2) the use of a ten-year average to calculate Respondent’s gross income; and
(3) the failure to calculate Petitioner’s current income. We discuss each issue in turn.

31
1. 	After Tax Income (Respondent)
{49} 	Gross income is calculated using pre-tax income. See § 40-4-11.1(K) (“Gross
Monthly Income: Includes all income[.]”); Boutz, 1999-NMCA-131, ¶ 25 (“We can
discern no clear intent in the statute to consider hypothetical tax consequences of
reported income before it is inserted into the child support tables.”). However, in its
May 2, 2014 oral ruling, the district court expressly indicated that the 2010 decree was
based upon Respondent’s income after deduction of tax payments. For 2011, the
district court gave no indication whether gross income was calculated pre- or post-tax
in the present case, but it stated that it was “looking at the numbers that were
calculated based on the method that was recently approved [in] Clark[.]” As discussed
above, Clark held that funds distributed to a shareholder constitute gross income
unless they are used to “offset the payment [of] income taxes resulting from any K-1
allocations.” 2014-NMCA-030, ¶ 12. While Clark justifies certain modifications to
Respondent’s gross income, we question the degree to which the district court may
have done so. Petitioner’s Exhibit One provides various financial data, including:
“Respondent’s Cash Received [From All Sources],” “ Total Taxes Paid,” and “After
Tax Cash Income.” Petitioner’s Exhibit One differentiates between income received
from Respondent’s shareholder interests in Summit Electric and Jury & Associates
and from salary. Petitioner’s Exhibit One does not, however, differentiate between

32
taxes paid on shareholder income and salary income. This differentiation is important
given the distinction drawn above between the treatment of pass-through income used
for payment of income taxes under Clark and the treatment of traditional W-2
earnings. For example, Petitioner’s Exhibit One provides the following data for 2011:
$4,219,841 of cash received from all sources; $1,434,478 of total taxes paid; and
$2,785,363 of after tax cash income. Respondent’s “After Tax Cash Income” results
from subtracting $1,434,478 from $4,219,841. However, even applying Clark, this
calculation incorrectly applies Section 40-4-11.1(K). “Cash Received [From All
Sources]” details Respondent’s 2011 earnings: $2,610,309 from his ownership interest
in Summit Electric; $262,929 from his ownership interest in Jury & Associates;
$1,014,055 from salary; and $332,548 from other income. The taxes paid on these
four amounts are then blended together as “Total Taxes Paid.” This calculation
improperly combines income taxes paid on Respondent’s income from his ownership
interests in Summit Electric and Jury & Associates with income taxes paid on his
income received as salary and other income. In short, any taxes paid that are
attributable to Respondent’s salary and other income must be incorporated into gross
income.

33
2. 	Multi-Year Averaging (Respondent)
{50} 	Section 40-4-11.1(K) requires that gross income be calculated based on “current
income if steady[,]” or, if not steady, by reference to “last year’s income tax return.”
As discussed above, other jurisdictions allow multi-year averaging in cases in which
the obligor’s income fluctuates. However, we are aware of no other jurisdiction that
permits the use of a ten-year average in calculating current income. See Zimin, 837
P.2d at 123 (stating “a ten-year average is generally not a reliable indicator of an
obligor parent’s current earning capacity”). In the present case, after stating that it did
not have “the numbers for 2013” or “for 2012,” the district court used a ten-year
average to calculate Respondent’s gross income, arriving at a total of $813,463 per
year for 2011. Unfortunately, we are unable to recreate the district court’s calculation
using Petitioner’s Exhibit One. Our ten-year average for the years 2002-2011 results
in after tax cash income for Respondent of $976,155—a difference of more than
$160,000 from the district court’s total of $813,463. This disparity emphasizes the
rationale behind requiring the district court to explain deviations from the child
support guidelines in writing. See Tedford, 1998-NMCA-067, ¶¶ 32-33 (describing
the failure to “clearly indicate” how it determined the child support award as error).
Because we do not have the benefit of briefing on the topic, we decline to expressly
decide whether and to what extent multi-year averaging is allowable when calculating

34
a party’s gross income for purposes of determining child support obligations. Absent
such a decision, Respondent’s actual gross income for 2011 remains unclear. As such,
on remand, the district court shall, in light of this opinion and other persuasive
sources, make such a determination and clearly indicate in its order the exact
calculations used in determining the parties’ gross incomes.
3. 	Current Income (Petitioner)
{51} 	Section 40-4-11.1(C)(1) defines “income” as “actual gross income of a parent
if employed to full capacity or potential income if unemployed or underemployed.”
This subsection empowers district courts to impute income as needed in order to
accurately derive the parties’ gross monthly incomes. See State ex rel. Human Servs.
Dep’t v. Kelley, 2003-NMCA-050, ¶ 13, 133 N.M. 510, 64 P.3d 537 (“The child
support 	guidelines 	require 	the 	imputation 	of 	income 	to 	an 	unemployed 	or
underemployed parent to the level of employment at full capacity.”). In 2010, the
district court estimated Petitioner’s earning capacity to be $4,000 per month and
continued to impute that amount in the present case. However, the record evidence
includes Petitioner’s 2011 tax returns. In 2011, Petitioner reported an adjusted gross
income of $109,089 on her federal tax returns. Dividing $109,089 by twelve provides
a more accurate gross monthly income for Petitioner than the amount imputed for the
2010 decree. We can discern no reason for the continued imputation of income when

35
evidence of actual gross income has been provided. Because the district court
calculated Respondent’s gross annual income through 2011, Petitioner’s 2011 tax
return is the most appropriate source from which to determine Petitioner’s gross
income. See Boutz, 1999-NMCA-131, ¶ 10 (holding that the district court must, to the
degree possible, calculate the parties’ gross incomes during the same time period).
D. 	Inequities as Between the Parties
{52} 	Because we do not have the benefit of a Rule 11-706 expert on appeal, we are
unable to determine to any degree of certainty the extent to which recalculation of the
parties’ gross monthly incomes will affect Respondent’s child support obligation.
While $10,707 appears to be an appropriate basic child support amount, the district
court could reconsider that amount on remand. Nevertheless, because the parties’
gross monthly incomes and the percentage of combined income are non-discretionary
determinations, we provide the following model to demonstrate the potential inequity
that results from an incorrect calculation of gross income.
{53} 	The 2010 decree, which applies Petitioner’s gross annual income of $168,000
and Respondent’s annual after-tax cash income of $750,000, operates as follows:

36
Part 1 	Basic Support 	Mother 	Father 	Combined
1. 	Gross Monthly Income 	$14,000 	$52,500 	$66,500
2. 	Percentage of Combined
Income
21% 	79% 	100%
3. 	Number of Children 	2
4. 	Basic Support from Table 	$10,707
5. 	Shared Custody Basic
Obligation
$16,060
6. 	Each Parent’s Share 	$3,373 	$12,688
7. 	Number of 24 Hour Periods
with Each Parent
201 	164 	365
8. 	Percentage with Each Parent 	55% 	45% 	100%
9. 	Amount Retained 	$1,855 	$5,710
10. 	Each Parent’s Obligation 	$1,518 	$6,978
11. 	Amount Transferred 	$5,460
Part 2 	Additional Monthly Payments
12. 	Children’s Health and Dental 	$300
13. 	Work-Related Child Care (NA)
14. 	Additional Expenses (Tuition) 	$2,500
Petitioner’s Contribution (21%) 	$588
Respondent’s Actual
(Transferred) Obligation
$4,872
{54} 	If we recalculate for 2011 assuming that (1) $10,707 remains the basic child
support amount, (2) Respondent’s gross income is calculated using a post-tax three-
year average for the years 2009, 2010, and 2011, which results in a total of

4The actual three-year average of $1,464,139 is reduced by $120,000 to account
for spousal support paid by Respondent. It is not increased in consideration of the
district court’s deduction of taxes paid on W-2 earnings as discussed above.
37
$1,344,139,4 and (3) Petitioner’s gross income of $109,089 is determined using her
2011 tax returns, the impact on Respondent’s child support obligation is as follows:
Part 1 	Basic Support 	Mother 	Father 	Combined
1. 	Gross Monthly Income 	$9,090 	$112,110 	$121,101
2. 	Percentage of Combined
Income
8% 	92%
3. 	Number of Children 	2
4. 	Basic Support from Table
(static)
$10,707
5. 	Shared Custody Basic
Obligation
$16,060
6. 	Each Parent’s Share 	$1,284 	$14,775
7. 	Number of 24 Hour Periods
with Each Parent
201 	164 	365
8. 	Percentage with Each Parent 	55% 	45% 	100%
9. 	Amount Retained 	$706 	$6,648
10. 	Each Parent’s Obligation 	$578 	$8,127
11. 	Amount Transferred 	$7,549
Part 2 	Additional Monthly Payments
12. 	Children’s Health and Dental 	$300
13. 	Work-Related Child Care (NA)
14. 	Additional Expenses (Tuition) 	$2,500

38
Petitioner’s Contribution (8%) 	$224
Respondent’s Actual
(Transferred) Obligation
$7,325
The $7,549 basic amount transferred represents a thirty-eight percent increase over
Respondent’s basic amount transferred of $5,460 in the 2010 decree. The $7,325
actual obligation represents a fifty percent increase over Respondent’s total amount
transferred of $4,872 in the 2010 decree. Such increases result in “a presumption of
material and substantial changes” as contemplated by Section 40-4-11.4(A).
{55} 	We understand that these numbers are, to a degree, hypothetical. However, we
believe that the impact on Petitioner’s percentage of combined monthly income, which
was twenty-one percent in the 2010 decree, requires consideration. This percentage
has an obvious effect on each party’s basic child support obligation. It also figures
into the additional payments and expenses portion of Worksheet B. The 2010 decree
required Petitioner to pay twenty-one percent of the costs for the children’s health and
dental insurance and private school tuition. If Petitioner’s gross monthly income
actually amounts to approximately eight percent of the parties’ combined gross
monthly income, an order that results in Petitioner’s overpayment is inequitable as
between the parties.
{56} 	At oral argument before this Court, Respondent argued that inequities arising
from arguably incorrect percentages of combined income are mitigated by informal

39
understandings between the parties. As an example, Respondent implied that increases
in the children’s tuition have gone unaccounted for since entry of the 2010 decree.
This may be the case. However, a motion to modify child support focuses on the
period between the previous adjudication and the filing of a motion to modify by
either party. Section 40-4-11.4(B)(1) contemplates “an annual exchange of financial
information . . . for the year preceding the request [to modify.]” Regardless of
practical, but non-judicially recognized or mandated alterations to the 2010 decree,
it is the terms of the 2010 decree that are at issue on remand.
{57} 	We recognize that the district court is empowered to deviate from the child
support guidelines as provided in Section 40-4-11.2. Because the parties’ combined
gross monthly income, by any measure, exceeds $30,000, the district court could
make gross income and percentage of combined income calculations exactly as
described above and then elect to reduce the basic child support amount as a matter
of discretion. However, when faced with a statutory presumption of material and
substantial changes in circumstances, the district court does not have discretion to
deny a motion to modify if doing so would perpetuate an objectively incorrect
determination of the parties’ percentage of combined income.
{58} 	On remand, if the district court’s recalculation of the parties’ gross monthly
incomes results in a deviation upward or downward of more than twenty percent such

40
that Petitioner is entitled to a statutory presumption of material and substantial
changes, the district court shall consider the recalculated percentage of combined
income attributable to Petitioner independent of other considerations. If continued
enforcement of the 2010 decree would result in inequity between the parties, the 2010
decree must be modified.
ATTORNEY FEES
{59} 	This Court reviews awards of attorney fees for abuse of discretion. Bustos v.
Bustos, 2000-NMCA-040, ¶ 24, 128 N.M. 842, 999 P.2d 1074. Rule 1-127 NMRA
governs the award of attorney fees in domestic relations cases and requires
consideration of the “disparity of the parties’ resources, prior settlement offers, the
total amount of fees and costs expended by each party, and the success on the merits.”
Weddington v. Weddington, 2004-NMCA-034, ¶ 27, 135 N.M. 198, 86 P.3d 623. No
single factor is dispositive. See id. ¶ 28 (holding that “disparity is only one factor to
be considered and disparity cannot support reversal where the other factors weigh in
favor of the award of attorney fees”).
{60} 	The district court concluded that Respondent was the prevailing party on the
merits and awarded attorney fees consistent with that conclusion in the amount of
$15,000. The district court additionally concluded that several of the issues raised in
Petitioner’s motion to modify lacked merit and awarded Respondent $750 in attorney

41
fees for the cost of defending. The district court’s finding that Respondent prevailed
on the merits, when viewed in conjunction with record evidence of settlement offers
made by Respondent, could support an award of attorney fees. However, our reversal
on the merits undermines the primary rationale underlying the district court’s
conclusion. The district court concluded that Respondent was the prevailing party
because “[Petitioner] did not get an increase in child support.” This issue is open on
remand. See Rabie v. Ogaki, 1993-NMCA-096, ¶ 18, 116 N.M. 143, 860 P.2d 785
(holding that “ordinarily the district court should reconsider an award of attorney’s
fees and expenses when the judgment is reversed and the matter remanded to that
court”). Therefore, we reverse the district court’s award of attorney fees in the
amounts of $15,000 and $750. The district court may reconsider the appropriateness
of awards of attorney fees to both parties, including appellate attorney fees, on
remand.
{61} 	The same analysis does not apply to the district court’s February 2, 2015 award
of attorney fees arising from Respondent’s post-judgment enforcement actions. On
September 30, 2014, the district court entered its judgment. Respondent thereafter
began efforts to enforce the awards of attorney fees in his favor. Rule 1-069(A)
provides that, “[u]pon request of the judgment creditor or a successor in interest, the
clerk shall issue a subpoena directing any person with knowledge that will aid in

42
enforcement of or execution on the judgment, including the judgment debtor, to
appear before the district court to respond to questions concerning that knowledge.”
Respondent filed notice to depose Petitioner in accordance with Rule 1-069 on
November 4, 2014. Petitioner did not appear for this scheduled deposition and filed
various motions seeking protection from deposition and other enforcement efforts.
Respondent filed responses to the motions as well as a motion to compel Petitioner’s
deposition. He also appeared in court to litigate these motions. Following a hearing
on the merits, the district court denied Petitioner’s motions and awarded Respondent
attorney fees in the amount of $1,500.
{62} 	Petitioner argues on appeal that the district court was divested of authority to
increase its award of attorney fees because the matter was pending on appeal.
Petitioner’s argument presents a question of subject matter jurisdiction, which we
review de novo. Weddington, 2004-NMCA-034, ¶ 13. Petitioner does not argue that
this award constituted an abuse of discretion by the district court. See State v.
Garnenez, 2015-NMCA-022, ¶ 15, 344 P.3d 1054 (“We will not address arguments
on appeal that were not raised in the brief in chief and have not been properly
developed for review.”).
{63} 	Generally speaking, the filing of notice of appeal by either party “divests the
district court of jurisdiction and transfers jurisdiction to the appellate court.” Murken

43
v. Solv-Ex Corp., 2006-NMCA-064, ¶ 9, 139 N.M. 625, 136 P.3d 1035. This rule is
not absolute. Id. The district court retains jurisdiction “to carry out or enforce the
judgment.” Id. (internal quotation marks and citation omitted). Rule 1-069 is solely
related to enforcement of a judgment and is collateral to the matters on appeal. See
State ex rel. Howell v. Montoya, 1965-NMSC-005, ¶ 11, 74 N.M. 743, 398 P.2d 263
(interpreting Rule 69 of the Federal Rules of Civil Procedure and holding that “a new
or independent action is not contemplated, but . . . the supplementary proceedings
authorized by [Rule 69] is only a continuation of the original case for the purpose of
discovery in aid of the enforcement of the judgment” (emphasis added)); see also Kelly
Inn No. 102 v. Kapnison, 1992-NMSC-005, ¶ 39, 113 N.M. 231, 824 P.2d 1033 (“[I]n
collateral matters not involved in the appeal, . . . the trial court retains jurisdiction.”).
{64} 	Because the district court had subject matter jurisdiction over the parties under
Rule 1-069, we affirm the February 2, 2015 attorney fee award of $1,500 to
Respondent.
CONCLUSION
{65} 	For the foregoing reasons, we reverse and remand to the district court. On
remand, the district court must use a figure for gross income consistent with the
evidence offered at trial, and the court must then enter each parties’ gross income into
the child support guidelines to determine whether there has been a deviation of more

44
than twenty percent. If not, the court still has to apply the factors in Spingola to
determine whether there has been a material and substantial change justifying
modification. If there is a deviation of more than twenty percent, the presumption does
apply, and the court should first consider whether the non-movant has rebutted that
presumption. 	Even 	if 	the 	presumption 	is 	rebutted, 	the 	district 	court 	must
independently consider whether the recalculated percentage of combined income
attributed to each party is inequitable such that modification is required. The district
court must enter findings and conclusions that transparently supply the court’s
underlying basis for its determination whether to grant or deny the motion to modify,
so that the parties are clear as to the manner in which the court evaluated the motion
to modify.
{66} 	IT IS SO ORDERED.
________________________________
JAMES J. WECHSLER, Judge
WE CONCUR:
________________________________
JONATHAN B. SUTIN, Judge
________________________________
STEPHEN G. FRENCH, Judge