COA nixes ultra-slow child support payback plan

A trial court abused her discretion when she ordered a father to pay child support arrears of $24,400 at the rate of $100 per month—which would have taken more than 20 years—when his income allowed him to pay the entire amount in a lump sum, a divided panel of the North Carolina Court of Appeals has ruled.

Pursuant to a 2009 order, Scott Ramsey was obligated to pay Kelli Dillingham $4,877 per month in child support for their four children. The order did not address any reduction in child support upon a child turning 18 and in fact, neglected to address the cessation of child support at all.

After their oldest child started college, Ramsey unilaterally reduced his child support payment by 25 percent. When their second child started college, he reduced his payments by another 25 percent. Ramsey did not file any request for modification with the court before decreasing his payments.

Dillingham filed a motion for contempt and show cause requesting the past due child support. Buncombe County District Court Judge Andrea Dray entered an order in January 2018 finding that Ramsey had failed to make payments as required by the 2009 order and ordering him to pay $24,400 in child support arrears—but in $100 monthly installments.

On appeal, Dillingham argued that the payment schedule was an abuse of the trial court’s discretion. By extending the arrears payments over 20 years, the children who were to benefit from the child support would be in their thirties, she argued. Further, Ramsey earns more than $1.7 million per year and had the ability to pay the full arrears in a lump sum.

Ramsey countered that Dillingham had abandoned any argument about the amount of monthly payments by not requesting a specific amount before the trial court.

Finding that there was “no reason” for Dillingham to have requested a particular monthly payment because Ramsey had not raised any objection based on his ability to repay the arrears, Judge Donna Stroud reversed the trial court’s order as to the schedule for payment and remanded the case for entry of an order requiring him to pay any remaining arrears. 

“The trial court’s order wrongly placed on [Dillingham] the burden to seek enforcement or modification of the prior order promptly after [Ramsey] unilaterally reduced his payments,” she wrote. “Although the timing of the payment of any remaining arrearages owed on remand falls within the trial court’s discretion, that discretion is not without bounds but should take into account the fact that one child of the parties is still a minor who may directly benefit from the support and [Ramsey’s] ability to pay promptly.”

‘Sanctity’ of court orders

The trial court’s order included findings of fact that Ramsey paid more than $120,000 for the college expenses of the parties’ children, and thousands of dollars for school trips and sporting equipment, computers and vehicles, and health insurance and healthcare expenses. But these voluntary payments had no impact on the 2009 order, under which Ramsey had no legal right to unilaterally reduce child support, Stroud wrote.

Ramsey’s “voluntary payments are not a proper factor for consideration as to the trial court’s decision as to how the arrears should be paid,” the court said. “Although his voluntary support for the parties’ adult children is admirable, it does not change the law regarding his child support obligation under the 2009 order.”

The trial court also erroneously characterized Dillingham as “complicit” in Ramsey’s underpayments by not taking him to court sooner.

“By finding [Dillingham] ‘complicit’ in ‘allowing [Ramsey] to believe’ that his reduction of child support was ‘not resisted,’ the trial court essentially found fault with [Dillingham] for waiting to enforce the order,” Stroud said. “There is no basis in the law for punishing [Dillingham] for ‘waiting’ for a year and two months to file a motion to force [Ramsey] to do what he was legally obligated to do. Even had [Dillingham] agreed for [Ramsey] to reduce his payments without an order from the court modifying the support, the 2009 order would still be enforceable.”

The burden to reduce his child support payments belonged to Ramsey, Stroud said.

“Any ruling which could be interpreted as encouraging unilateral reductions of child support without court approval endangers the sanctity of judgments,” she wrote. “The trial court abused its discretion by fashioning a remedy for [Ramsey’s] failure to pay child support as ordered without considering the purpose of child support, the welfare of the minor children and without considering [Ramsey’s] ability to pay.”

Five days of earnings

Stroud acknowledged that most disputes over paying arrearages center on the ability to pay. However, other factors also come into play, the court said, such as the welfare of the minor children. At the rate of repayment set by the trial court, the parties’ youngest child will be age 35 and the second oldest will be 38, with the majority of the arrearages paid “long after all four children have become adults,” the court said.

“Instead of having the arrearages paid while the two youngest children are still minors living with [Dillingham] – while they can still benefit directly from the child support – nearly all of the arrearages will be paid long after all of the children have become adults,” she wrote.

According to Ramsey’s own evidence, his income for 2017 was $144,196 per month, or approximately $4,800 per day.

“The entire arrears is five days of earnings for [Ramsey],” Stroud wrote. “The $100 monthly payment is .069 percent of [Ramsey’s] monthly gross income. In contrast, [Dillingham’s] annual gross income is $46,054.44; the entire arrears is over half of her annual income.”

Judge John M. Tyson dissented. Because Dillingham did not address the issue of the repayment schedule in the trial court, her challenge was not properly before the court, he said.

Brian W. Sharpe of Sharpe & Bowman in Marshall, who represented Dillingham, said the decision reinforces the “black letter law” that parties may not unilaterally reduce child support payments, as well as the principle underlying support payments.

“Trial courts have broad discretion in setting these repayment schedules but still need to honor the central, guiding principle of child support payments: the best interest and welfare of the children,” he explained. “Where the great majority of the arrearage would have been paid after these kids were old enough to be lawyers themselves, it is difficult to marry the repayment schedule with that overarching principle.”

Greensboro attorney Afi Johnson-Parris, current president of the North Carolina Bar Association’s family law section, noted the access to justice issues presented in the case.

“The trial court was essentially punishing [Dillingham] for not bringing the case back to court without an appreciation for the fact that she makes less than $50,000 per year and the financial impact it might have on her to try to enforce the original order,” Johnson-Parris said.

The decision also provides an important reminder for family law attorneys to “speak up” as to the rate of a repayment schedule, she added, which would eliminate the issue raised by the dissent.

Asheville attorney Brenda Coppede, who represented Ramsey, did not respond to a request for comment.

The 22-page decision is Dillingham v. Ramsey (Lawyers Weekly No. 011-242-19). The full text of the opinion is available online at nclawyersweekly.com.