Myers v. Cosgrove

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD
NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED
BY RULE 239(D)(2), SCACR.

THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Vickie F. Myers,       
Respondent,

v.

Christopher Carlton Cosgrove,       
Appellant.

Appeal From Greenville County

Robert N. Jenkins, Sr., Family Court
Judge

Unpublished Opinion No. 2004-UP-640

Submitted November 1, 2004 – Filed December
20, 2004

AFFIRMED IN PART, REVERSED IN PART,
AND REMANDED

Maggi Fields Bailey, of Greenville, for Appellant.

Jefferson G. Wood and E. Kimberly Berry, both of Greenville,
for Respondent.

PER CURIAM:  In this action for child support, a father appeals an
award of both retroactive and prospective child support and attorney’s fees
to the mother.  We affirm in part, reverse in part, and remand. [1]

FACTS

Vickie F. Myers (“Mother”) and Christopher
C. Cosgrove (“Father”) dated and cohabitated intermittently from July 1997 until
July 1999.  In November 1998, the couple had a child.  Mother brought
this action on May 2, 2001, pursuant to section 20-7-420 of the South Carolina
Code (Supp. 2003), seeking custody of the minor child, child support, retroactive
child support, and attorney’s fees.   

In a temporary order, the family court ordered
a paternity test.  If the paternity test was positive, Father was ordered to
pay the costs of the test and child support retroactively from the date the
action was filed.  The test results, which were positive, were mailed to both
parties on August 16, 2001; however, Father denies having any knowledge of the
results until January 2002.  Also in January 2002, the case was administratively
stricken from the active trial docket pursuant to the “270 day rule.”

In an order dated September 27, 2002, the court
denied Mother’s first motion to restore the action, in part because discovery
was not complete.  This was due largely to Father’s failure to cooperate with
Mother’s discovery requests.  The court gave Mother leave to file another motion
to restore when discovery was complete.  The court granted mother’s second motion
to restore the action as well as a contemporaneous motion to amend the pleadings. 
The motion to amend sought to include a request for Father to carry life insurance
for the benefit of their child.  The court also found Father waived the mediation
requirement by his refusal to participate.   

At the final hearing, Mother testified she is currently
employed as a legal assistant with a reported gross monthly income of $2,150.
Health insurance expenses each month for the minor child are $120.  Daycare
initially cost $303 per month but at the time of the final hearing cost approximately
$275 per month.  Mother also has custody of a seven-year-old son from a previous
relationship for which she receives no child support.                                              

Father testified he is a part-time tattoo artist
apprentice with a monthly income of $600. He has completed three and a half
years of a five-year apprenticeship.  He is thirty-two years of age and
in good health.  He reported living expenses of $810.87, including $237 per
month child support for another child.  Father, however, receives periodic gifts
of cash from his mother, who also pays for the mortgage on his residence, which
they jointly own.  He has not filed a tax return for the last five years.  When
asked why he did not file tax returns, he responded, “I’m making six hundred
dollars ($600) a month. And I do not owe the IRS any monies. You do not have
to file your income tax if you do not owe any money.”      

 The family court found Father to be the child’s
biological father, gave custody to Mother, awarded her child support of $589
per month, and required Father to pay retroactive child support from the date
of the initial filing.  The court ordered that back child support be paid in
two lump sum payments and ordered   Father to pay $7,500 of Mother’s attorney’s
fees and costs.  This appeal followed.

STANDARD OF REVIEW

In appeals from the family court, this court has
authority to find the facts in accordance with our own view of the preponderance
of the evidence. Woodall v. Woodall, 322 S.C. 7, 10, 471 S.E.2d
154, 157 (1996).  This broad scope of review, however, does not require us to
disregard the findings of the family court.  Stevenson v. Stevenson,
276 S.C. 475, 477, 279 S.E.2d 616, 617 (1981).  We are mindful that the family
court, who saw and heard the witnesses, was in a better position to evaluate
their credibility and assign comparative weight to their testimony.  Bowers
v. Bowers, 349 S.C. 85, 91, 561 S.E.2d 610, 613 (Ct. App. 2002).

LAW/ ANALYSIS

I. Child Support

Father claims the family court erred
in awarding Mother child support of $589 per month based upon an imputed income
of $2,929 per month.  We disagree.

The amount of a child support award is
within the sound discretion of the family court and will not be disturbed on
appeal absent an abuse of discretion.  Smith v. Smith, 264 S.C.
624, 628, 216 S.E.2d 541, 543 (1975).  In determining the amount of child support,
crucial factors include: the needs of the children; the incomes, earning capacities
and assets of the parents; and the health, ages, general physical condition,
and living expenses of the parents.  Bradley v. Bradley, 285 S.C.
170, 172-73, 328 S.E.2d 647, 648 (Ct. App. 1985). 

At trial, the family court heard an abundance of
testimony concerning the earning capacities of the parties, much of it conflicting. 
On his financial declaration, Father claimed a gross monthly income of $600
per month because he only worked three days a week as a tattoo apprentice. 
He testified the benefit of the apprenticeship is a resulting recommendation
into a tattoo guild, though he admitted “you don’t have to be a member of the
[guild to] set up shop and make money tattooing.”  Mother testified Father worked
both part-time and full-time as a tattoo artist when she was living with him
and he averaged $150 per day, after expenses.  She stated he had a reputation
in the community as a “very good artist.”  Father, on the other hand, stated
he usually averaged only $50 per day.         

Ten years ago, Father
was employed as a construction worker making approximately $14 per hour.  He
quit this job to follow the Grateful Dead around the country.  Even though he
did not graduate, he received a certificate of completion in 1991 from the Harley
Davidson mechanic’s program.  Furthermore, he was proficient enough in motorcycle
maintenance to build his own bike out of spare parts.  Mother provided current
occupational employment wage statistics for motorcycle mechanics and highway
maintenance workers in Florida, where Father currently resides.  Construction
workers with experience can earn $13 per hour, while entry-level mechanics can
earn as much as $10 per hour.  Father, however, testified he was injured in
“several” car wrecks, preventing him from doing any work that requires sitting
or standing.  He did not, however, submit any evidence to corroborate these
statements.  He also admitted he was not “really fighting” the denial of his
disability claim because he did not “need to be living off the state.”  He testified
he could “make enough to pay for [his] food on the table” with his salary of
$150 per week.  

Although this court has authority to find the facts
in accordance with our own view of the evidence, we are mindful that the family
court judge was better situated to evaluate witness credibility and assign comparative
weight to their testimony.  Bowers, 349 S.C. at 91, 561 S.E.2d at 613. 
It is abundantly clear from the family court’s order that the trial judge found
Father’s testimony grossly lacking in the areas of consistency and credibility,
and from what we can glean from the record on appeal, we agree.  Husband contradicted
himself throughout his testimony about his business, finances and the facts
of this case. For instance, on direct examination he testified his tattoo business
failed because he “didn’t have enough business smarts to keep it going.”  On
cross-examination, however, he claimed the business failed because “the guy
[he] was going in partnership with [was] tripped out on drugs.  And he made
[them] get kicked out of [their] studio.”  In a deposition, Father stated that
he was involved in litigation to recoup these business losses.  When questioned
on the matter at trial Father explained he “never pursued” the lawsuit.  In
fact, he could not even recall the name of the attorney representing him in
the alleged action.  Similarly, at trial, Father denied having knowledge of
the paternity test results until shortly before trial began, while in his deposition
he admitted learning of the results in January 2002. 

The South Carolina Code defines income
of a parent as “the actual gross income of the parent, if employed to full capacity,
or potential income if unemployed or underemployed.”  27 S.C. Code Ann. Regs.
114-4720(A)(1) (Supp. 2003).  To determine potential income, “the court should
determine the employment potential and probable earnings level of the parent
based on that parent’s recent work history, occupational qualifications, and
prevailing job opportunities and earning levels in the community.”  27 S.C.
Code Ann. Regs. 114-4720(A)(5)(b) (Supp. 2003).  For the reasons discussed above,
we find no error in the family court’s acceptance of Mother’s testimony regarding
Father’s earning potential for the purposes of calculating child support.

We likewise find the family court’s consideration
of money Father receives from his mother a proper factor in the computation
of child support.  In regard to computing income for the purpose of determining
child support, the regulations provide:

(2)(b) In addition to determining potential earnings, the
court should impute income to any non-income producing assets of either parent,
if significant, other than a primary residence or personal property . . . .

Gross income does not include: . . .

(3)(c) In-kind income; however, the court should count
as income expense reimbursements or in-kind payments received by a parent from
self-employment or operation of a business if they are significant and reduce
personal living expenses, such as a company car, free housing,
or reimbursed meals.

27 S.C. Code Ann. Regs. 114-4720(A)(2)(b) & (A)(3)(c)
(emphasis added).

Father admitted his mother gave him large
amounts of cash in 1998, 1999, and 2002 for maintenance of the house they jointly
own; however, he submitted no evidence that the money was actually spent on
anything relating to the upkeep of the house.  His mother also pays his portion
of the mortgage, amounting to approximately $5,149.92 per year.    In this case,
Father admits that by maintaining the house, he is managing an investment for
his mother.  Because Father’s personal expenses are substantially reduced by
the payments he receives for this service, we conclude the money given to Father
falls under the exception to the general rule that in-kind income is not gross
income for the purposes of computing child support.

Father argues that because he is not
obligated to pay taxes on this income, and there is no guarantee he will continue
receiving these monetary gifts in the future, it should not be considered as
“gross income” for the purposes of calculating child support.  We are not convinced. 
In Mobley v. Mobley, 309 S.C. 134, 139, 420 S.E.2d 506, 509 (Ct. App.
1992), this court held a husband’s income from employee benefits, including
housing and utilities, could be treated as income for purposes of determining
child support payments even though the husband had “no tax liability for the
value of the housing” or any guarantee that he would continue to receive the
bonuses.

Having reviewed the record, we find by
a preponderance of the evidence that Father has a potential to earn significantly
more income. We therefore affirm the family court’s determination that Father’s
imputed income is $2,929 per month.  Consequently, we uphold the family court’s
award of $589 per month in child support.  

II. Attorney’s  Fees

Father claims the family court
erred in awarding Mother $7,500 in attorney’s fees.  We disagree.

“The award of attorney’s fees is within the discretion
of the court.”  Hardwick v. Hardwick, 303 S.C. 256, 261, 399 S.E.2d
791, 794 (Ct. App. 1990).  In determining whether to award attorney’s fees,
the court should consider each party’s ability to pay his or her own fees, the
beneficial results obtained by the attorney, the parties’ respective financial
conditions, and the effect of the fee on each party’s standard of living.  E.D.M.
v. T.A.M., 307 S.C. 471, 476-77, 415 S.E.2d 812, 815 (1992).

We find no abuse of discretion
in requiring Father to pay a portion of Mother’s attorney’s fees.  The family
court found Mother owed her attorney at least $9,380.50.  In addition, Mother
incurred costs of $1,075.70 during the discovery process due to Father’s refusal
to cooperate.  Father also failed to comply with court ordered mediation, prolonging
this litigation.

 Father’s potential income,
combined with his earnings for managing the property on which he lives, brings
his total gross monthly income to an amount greater than Mother’s.  Furthermore,
Father has equity in the Florida residence of approximately $29,000. [2]    

On the other hand, Mother
has no assets or savings, and is burdened by considerable debt.  She cannot
afford to pay her attorney’s fees without substantially impacting the standard
of living of her and her children.  See Pendergast v. Pendergast,
354 S.C. 32, 40, 579 S.E.2d 530, 534 (Ct. App. 2003).  Because of Father’s conduct,
including his failure to comply with the mediation order or cooperate with discovery,
Mother incurred a greater amount of attorney’s fees.  Mother testified, “[h]e
just kept saying, ‘Take me to court’” when she would beg him for money.  In
fact, Father admitted he “didn’t give her any other option other than coming
to court.”  This court finds his conduct unnecessarily prolonged this litigation.

Mother’s counsel achieved
beneficial results, as she received a substantial award of child support, which
we now affirm.  As the family court’s appropriate consideration of the E.D.M.
factors in determining the amount of attorney’s fees is apparent from the record,
we conclude the family court did not err in requiring Father to contribute $7,500
toward Mother’s attorney’s fees.

III. Lump Sum Payments

Father claims the family court
erred in requiring him to pay attorney’s fees and retroactive child support
in large lump sum payments.  We disagree.

The family court ordered
Father to pay $2,500 of the attorney’s fees in a lump sum.  It further ordered
three equal installments of $3,951.67 for retroactive child support.  Father
has a potential income of $2,929 per month and substantial equity in his home. 
He has the ability to pay the past due child support and attorney’s fees in
the time allotted and this will not create any undue hardship or burden on him. 
Accordingly, we affirm the award of lump sum payments for the attorney’s fees
and child support.

IV. Life Insurance Award Reservation

Father claims the family court
erred in reserving an award of life insurance. We agree. 

South Carolina recognizes
the availability of life insurance as security for the support obligation. 
See S.C. Code Ann. § 20-3-160 (Supp.2003).  “The family court is within
its legal authority to require a supporting spouse to maintain a life insurance
policy naming the child as beneficiary to insure the continued support of the
minor child.”  Ivey v. Ivey, 286 S.C. 315, 318, 334 S.E.2d 123, 125 (Ct.
App. 1985).  This imposition, however, must be based on compelling reasons,
such as failure to pay, which make the security a necessity.  Id. 

Although the family court denied
Mother’s request for Father to maintain life insurance with the child as irrevocable
beneficiary, the court reserved the right to grant the request in six months.
A reservation of an award is not standard in child support cases because “if
it subsequently appears security is necessary, the continuing jurisdiction of
the family court affords ample opportunity to require security by life insurance.” 
Id.   The family court may reserve an award if there are present or foreseeable
circumstances warranting the reservation.  Hardy v. Hardy, 311 S.C. 433,
435-36, 429 S.E.2d 811, 813 (Ct. App. 1993).  When there are no compelling reasons
for an award of life insurance as security for the child support obligation
at the time of trial, and “no indication of physical or mental illness, foreseeable
change in need in the future, or such other extenuating circumstance,” reservation
is not appropriate.  Donahue v. Donahue, 299 S.C. 353, 363, 384 S.E.2d
741, 747 (1989).       

Because the record
does not reflect any specific factual findings to support reservation of the
grant of life insurance as security for support, we reverse the family court’s
ruling on this issue.  However, we remand this issue back to the family court
for additional findings to determine what extenuating circumstances exist, if
any, to justify a reservation of the award.

CONCLUSION

For the reasons stated herein, the family court’s
rulings are hereby

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

HEARN, C.J. , GOOLSBY and  WILLIAMS, JJ. , concur.

[1]   We decide this case without oral argument pursuant
to Rule 215, SCACR.

[2] Current equity in the home is approximately $58,000, split between
the co-owners.