Family Law Case Review: Indiana Supreme Court Ruling Resolved Conflict Within Court of Appeals Cases

Case: Mark Rolley v. Melissa Rolley
by Mike Kohlhaas, Bingham Greenebaum Doll

HELD: The Indiana Supreme Court granted transfer to hold that child support may be modified based upon EITHER a substantial and continuing change in circumstances, OR satisfaction of the “12-month / 20% rule.”

NOTED: This holding resolved a conflict within Court of Appeals cases. The 2000 Hay case and 2010 Reinhart case had held that support can be modified only upon a showing of a substantial and continuing change in circumstances, whereas the 2007 Kraft case and 2014 Rolley case permitted modification under either a substantial and continuing change in circumstances, or satisfaction of the 12-month / 20% rule set forth in Ind. Code 31-16-8-1.

More factual details of the case are provided below in the digest from the original Court of Appeals determination.

To view the text of this opinion in its entirety, click here: Mark Rolley v. Melissa Rolley

Digest of the Indiana Court of Appeals opinion:

HELD: When a parent, by agreement, receives child support at an amount less than the Guidelines would provide for, he or she may subsequently modify support to the Guidelines level without proving any substantial and continuing change of circumstances since the prior agreement was reached, provided the statutory “12 months / 20% change test” is met.

NOTED: The Court of Appeals’ opinion expressly requested that the Indiana Supreme Court resolve a series of conflicting Court of Appeals child support modification cases involving this issue.

FACTS AND PROCEDURAL HISTORY:
Mother and Father divorced, with their final settlement agreement approved in 2011. Although Father’s annual income consistently exceeded $1,000,000, and Mother’s income was nominal, the agreement set child support at only $350/wk for their child. The agreement recited that the amount was “not based upon the Indiana Child Support Guidelines but [was] a sum that each believe[d was] fair and equitable under the circumstances.”

Mother subsequently moved to modify the support level, and significant litigation ensued. Eventually, the trial court modified support to $1,419 per week using a Guidelines calculation. Father appealed.

Father’s appeal focused on Ind. Code 31-16-8-1, which establishes two grounds for modification of child support:

(1) upon a showing of changed circumstances so substantial and continuing as to make the terms unreasonable (“Subsection 1”);

or

(2) upon a showing that: (A) a party has been ordered to pay an amount in child support that differs by more than twenty percent (20%) from the amount that would be ordered by applying the child support guidelines; and (B) the order requested to be modified or revoked was issued at least twelve (12) months before the petition requesting modification was filed (“Subsection 2”).

The Court of Appeals reviewed a series of cases, some contradictory with each other, that present a proposition that, when child support is set by agreement, modification may require more than merely satisfying Subsection 2. In effect, that petitioner may be required to prove Subsection 1 (that the prior agreement has become unreasonable) in order for a modification to be granted. Father’s appeal rested on the argument that Mother failed to carry that added burden.

After reviewing the history of cases addressing this issue, and expressly soliciting the Indiana Supreme Court to visit this area in order to resolve the conflicting case law, the Court of Appeals concluded that support modification is appropriate when a parent can satisfy either Subsection 1 or Subsection 2. Second, the Court of Appeals held that there is not a different, higher legal standard applied to the modification of child support orders that were reached by prior agreement. The Court noted that its conclusion was based upon the plain language of the statute, in which Subsection 1 and Subjection 2 are clearly separated by “or.”

The Court also focused on the fact that, in the instant case, Mother originally agreed to a support amount that was lower than Guidelines level. Since the right to child support belongs to the child, Mother’s agreement to accept a lesser amount is essentially unenforceable and against public policy. The Court noted that under the opposite set of facts – for example, a parent who originally agrees to pay higher than Guidelines support, but then later seeks to modify – may be subject to denial based upon the doctrine of invited error.

The Court also rejected Father’s alternative argument that support should not have been increased because Mother was supporting the child adequately based upon the existing support level.

Thus, the trial court’s decision to modify child support, based upon more than 12 months passing since the original order and a new calculation of child support differing by more than 20%, was affirmed.

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James A. Reed and Michael R. Kohlhaas of Bingham Greenebaum Doll represent clients in a wide spectrum of relationship transition and wealth planning matters, including premarital agreements, estate planning, cohabitation, separation, divorce (especially involving high net worth individuals and/or complex asset issues), custody, parenting arrangements, adoption, and domestic partnerships. Bingham Greenebaum Doll, a multidisciplinary law firm serving regional, national, and international clients, is the fourth-largest law firm in Indiana. The firm’s main practices include corporate, property, litigation, labor, government law, and personal services law. Visit the firm’s website at www.bgdlegal.com.

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

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