[Cite as Zilko v. Zilko, 2011-Ohio-2140.]
COURT OF APPEALS
ASHLAND COUNTY, OHIO
FIFTH APPELLATE DISTRICT
DAVID ZILKO JUDGES:
Hon. William B. Hoffman, P.J.
Plaintiff-Appellee/Cross-Appellant Hon. Sheila G. Farmer, J.
Hon. John W. Wise, J.
-vs-
Case No. 10-CA-015
LISA ZILKO
Defendant-Appellant/Cross-Appellee OPINION
CHARACTER OF PROCEEDING: Appeal from the Ashland County Court of
Common Pleas, Domestic Relations
Division, Case No. 08-DIV-235
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: May 4, 2011
APPEARANCES:
For Plaintiff-Appellee For Defendant-Appellant
JAMES M. RICHARD JOSEPH P. KEARNS, JR.
Richard Law Office LLC Mason, Mason & Kearns
127 East Liberty Street, Suite 100 P.O. Box 345
P.O. Box 1207 153 West Main Street
Wooster, Ohio 44691 Ashland, Ohio 44805
Ashland County, Case No. 10-CA-015 2
Hoffman, P.J.
{¶1} Defendant-appellant/cross-appellee Lisa Zilko (“Wife”) appeals the May
13, 2010 Judgment Entry-Decree of Divorce entered by the Ashland County Court of
Common Pleas, Domestic Relations Division, relative to the trial court’s calculation of
child support as well as its decision not to award spousal support. Plaintiff-
appellee/cross-appellant David Zilko (“Husband”) appeals the same relative to the trial
court’s division of the marital debts and assets.
STATEMENT OF THE FACTS AND CASE
{¶2} Husband and Wife were married on June 5, 1993, in Parma, Ohio. Two
children were born as issue of said marriage, to wit: Jamie Lynn Zilko (DOB 1/4/97) and
Timothy Allen Zilko (DOB 1/3/99). Husband filed a complaint for divorce on October 20,
2008. Wife filed a timely answer and counterclaim. The trial court issued temporary
orders ordering the parties to pay their individual living expenses. Husband also was
ordered to pay child support in the amount of $381.58/month for both children. In
addition, Husband was responsible for all expenses related to the marital residence, all
expenses of the parties’ business, and the payment for the parties’ vehicles. The trial
court ordered Wife to pay her credit card indebtedness. The matter came on for final
hearing on February 17 and 25, 2010.
{¶3} When the parties married, Husband worked as an unskilled laborer. In
1995, the parties purchased a 50% share in Hilltop Villa, a home for disabled veterans,
and the land upon which the facility is located from Ronald and Terry Kaufman. The
parties and the Kaufmans set up two Ohio corporations in association with the
purchase. Hilltop Villa Enterprises, Inc. served as the operational company. K & Z
Ashland County, Case No. 10-CA-015 3
Properties, Inc. owned the real estate, which it rented to Hilltop Villa. The monthly rent
Hilltop Villa paid to K & Z Properties was between $3,000.00 and $4,000.00/month. In
2002, the parties bought out the Kaufmans’ half of the business for $143,500.00, by way
of share redemption agreements. Of the purchase price, $137,000.00 was allocated to
the real estate, and $6,500.00 was allocated to the business.
{¶4} As the division of property was at issue at trial, each party presented
his/her own expert to offer evidence of the value of the business. Jack Gant, a
broker/real estate salesman testified on behalf of Husband. Gant stated he was unable
to do an income evaluation of the business because the home was not continually
occupied as each veteran is there on a thirty day basis. Gant placed the value of the
property in today’s market between $120,000.00 and $130,000.00. Gant explained the
$10,000 price range was due to the uniqueness of the property. For example, a 2000
gallon heating fuel storage tank was buried on the property and an environmental
investigation would be required prior to a bank loaning money to an individual to
purchase the business. Wife offered an appraisal prepared by Robert Race in
November, 2001, which the parties used to set the price for their buyout for the
Kaufmans’ share of the business. Race appraised the business and land at
$283,000.00.
{¶5} Husband received a yearly salary of $33,000.00 from Hilltop Villa
Enterprises. K & Z Properties paid $2,100.00/month to the Kaufmans on the land
contract debt. A Schedule K-1 IRS tax form reported K & Z Properties had a net income
of $23,194.00 in 2008.
Ashland County, Case No. 10-CA-015 4
{¶6} On April 26, 2010, the trial court issued its decision. The trial court
awarded the business to Husband, valuing such at $130,000.00, and assessing the
liability on the Kaufman note ($60,582.00) to Husband as well. The trial court denied
Wife’s request for spousal support. The trial court further ordered Husband to pay child
support in the amount of $222.71/child/month plus poundage. The trial court utilized a
figure of $33,000.00 as Husband’s self-employment income.
{¶7} Via Judgment Entry-Decree of Divorce filed May 13, 2010, the trial court
granted each party a divorce on the ground of incompatibility. The trial court allocated
parental rights and responsibilities, naming Wife as the residential parent of the
children. The trial court ordered Husband to pay Wife $450.33/month as and for child
support. The trial court awarded Husband all interest in K & Z Properties and Hilltop
Villa Enterprises. Husband was also ordered to assume the entire unpaid balance due
and owing on the promissory note due to the Kaufmans. Additionally, Husband was
solely responsible for “all business indebtedness pertaining to Hilltop Villa Enterprises,
Inc. and K & Z Properties, Inc., including, but not limited to, any charge card
indebtedness.” May 13, 2010 Judgment Entry-Decree of Divorce section 6 (A)(VIII).
{¶8} It is from this judgment entry Wife appeals, raising the following
assignments of error:
{¶9} “I. THE TRIAL COURT ABUSED ITS DISCRETION BY NOT INCLUDING
OTHER INCOME OF THE APPELLEE IN COMPUTING CHILD SUPPORT.
{¶10} “II. THE TRIAL COURT ABUSED ITS DISCRETION IN NOT AWARDING
THE APPELLANT SPOUSAL SUPPORT.”
{¶11} Husband cross-appeals the same, asserting the following errors:
Ashland County, Case No. 10-CA-015 5
{¶12} “I. THE TRIAL COURT ABUSED ITS DISCRETION BY OMITTING AN
AGREED TO BUSINESS DEBT IN DETERMINING THE TOTAL DIVISION OF
PROPERTY AND DEBT ORDER.
{¶13} “II. THE TRIAL COURT’S CALCULATION OF THE TOTAL DIVISION OF
PROPERTY AND DEBT ORDER IS AGAINST THE MANIFEST WEIGHT OF THE
EVIDENCE.”
Appeal
I
{¶14} In her first assignment of error, Wife maintains the trial court abused its
discretion in failing to include all of Husband’s income in its child support computation.
{¶15} A trial court's decision regarding a child support obligation will not be
reversed on appeal absent an abuse of discretion. Pauly v. Pauly, 80 Ohio St.3d 386,
390, 1997-Ohio-105, 686 N.E.2d 1108, citing Booth v. Booth (1989), 44 Ohio St.3d 142,
144, 541 N.E.2d 1028. An abuse of discretion is more than an error of law, it connotes
that the court's attitude is unreasonable, arbitrary, or unconscionable. Blakemore v.
Blakemore (1983), 5 Ohio St.3d 217, 450 N.E.2d 1140. Moreover, as long as the
decision of the trial court is supported by some competent, credible evidence, the
reviewing court will not disturb it. Masitto v. Masitto (1986), 22 Ohio St.3d 63, 488
N.E.2d 857.
{¶16} A trial court must calculate the amount of child support using the basic
child support schedule and the applicable child support computation worksheet. R.C.
3119.02. Here, the trial court appropriately relied on the worksheet set forth in R.C.
3119.022, which applies to situations in which one parent is designated the residential
Ashland County, Case No. 10-CA-015 6
parent and legal custodian. To complete that worksheet, a trial court must first
determine each party's income. For a parent who is employed to full capacity, “income”
means “the gross income of the parent.” R.C. 3119.01(C)(5). According to R.C.
3119.01(C)(7), “gross income” is “the total of all earned and unearned income from all
sources during a calendar year, whether or not the income is taxable, and includes * * *
self-generated income.” R.C. 3319.01(C)(13) defines “self-generated income” as “gross
receipts received by a parent from self-employment, proprietorship of a business, joint
ownership of a partnership or closely held corporation, and rents minus ordinary and
necessary expenses incurred by the parent in generating the gross receipts.” “Ordinary
and necessary expenses incurred in generating gross receipts” include “actual cash
items expended by the parent or the parent's business.” R.C. 3119.01(C)(9)(a).
{¶17} Wife submits the trial court abused its discretion in failing to consider
income Husband received from K & Z Properties which was evidenced in a 2008
Schedule K-1. The K-1 indicated K & Z Properties had a net income of $23,194.00, in
2008, and Wife argues said amount should be included in Husband’s gross income in
computing the child support order.
{¶18} While we agree with Wife net income generated by the business should
be included in Husband’s gross income, we find no evidence to support a determination
K & Z Properties had net income prior to 2008, and/or in 2009, or 2010. Husband
testified the monies were the result of one time pay backs by Veteran’s Administration
to a number of the disabled veterans housed at Hilltop Villa.
Ashland County, Case No. 10-CA-015 7
{¶19} Based upon the foregoing, we find the trial court did not abuse its
discretion in only utilizing a gross annual income of $33,000 for Husband in calculating
child support.
{¶20} Wife’s first assignment of error is overruled.
II
{¶21} In her second assignment of error, Wife contends the trial court abused its
discretion in failing to award her spousal support.
{¶22} An award of spousal support is in the trial court's sound discretion. Kunkle
v. Kunkle (1990), 51 Ohio St.3d 64, 554 N.E.2d 83. In order to find an abuse of
discretion, we must determine the trial court's decision was unreasonable, arbitrary or
unconscionable and not merely an error of law or judgment. Blakemore v. Blakemore
(1983), 5 Ohio St.3d 217, 450 N.E.2d 1140.
{¶23} R.C. 3105.18(C)(1)(a) thru (n) sets forth the factors a trial court must
consider in determining whether spousal support is appropriate and reasonable and in
determining the nature, amount, terms of payment, and duration of spousal support.
These factors include:
{¶24} “(a) The income of the parties, from all sources, including, but not limited
to, income derived from property divided, disbursed, or distributed under section
3105.171 of the Revised Code;
{¶25} “(b) The relative earning abilities of the parties;
{¶26} “(c) The ages and the physical, mental, and emotional conditions of the
parties;
{¶27} “(d) The retirement benefits of the parties;
Ashland County, Case No. 10-CA-015 8
{¶28} “(e) The duration of the marriage;
{¶29} “(f) The extent to which it would be inappropriate for a party, because that
party will be custodian of a minor child of the marriage, to seek employment outside the
home;
{¶30} “(g) The standard of living of the parties established during the marriage;
{¶31} “(h) The relative extent of education of the parties;
{¶32} “(i) The relative assets and liabilities of the parties, including but not limited
to any court-ordered payments by the parties;
{¶33} “ * * *;
{¶34} “(l) The tax consequences, for each party, of an award of spousal support;
{¶35} “* * *;
{¶36} “(n) Any other factor that the court expressly finds to be relevant and
equitable.”
{¶37} Wife maintains based upon the factors set forth in R.C. 3105.18, an award
of spousal support was appropriate. Wife noted the length of the marriage, the affluent
life style in which the parties lived, and the fact Husband had a greater income and
greater income potential.
{¶38} Based upon our review of the record, we find the trial court did not abuse
its discretion in denying Wife’s request for spousal support. Both parties acknowledged
many of the family expenses were paid by the business prior to the parties’ separating.
Excess monies in the business accounts were distributed to the parties during the
course of the proceedings. Hilltop Villa was not running at full capacity with only
Ashland County, Case No. 10-CA-015 9
thirteen residents. Although some of the R.C. 3105.18 factors weighed in favor of
spousal support, other factors weighed against such an award.
{¶39} Based upon the foregoing, we do not find the trial court abused its
discretion by not ordering spousal support. Wife’s second assignment of error is
overruled.
Cross-appeal
I, II
{¶40} Because Husband’s first and second assignments of error in his cross-
appeal are interrelated, we shall address said assignments of error together. In his first
assignment of error, Husband argues the trial court abused its discretion in omitting an
agreed to business debt in determining the total division of marital property and debt. In
his second assignment of error, Husband contends the trial court’s total division of
martial property and debt was against the manifest weight of the evidence. We
disagree with both.
{¶41} At the final hearing, both parties testified the Advanta line of credit was
used to pay business expenses when cash was unavailable. Both parties
acknowledged the balance due was a business obligation. Husband contends the trial
court failed to include the Advanta line of credit in the division of marital property and
debt.
{¶42} Pursuant to the temporary orders, Husband was responsible for all of the
business expenses, which would include payments on the Advanta debt. In the final
divorce decree, the trial court awarded all interest in the business to Husband. The trial
court also allocated “all business indebtedness…including, but not limited to, any
Ashland County, Case No. 10-CA-015 10
charge card indebtedness” to Husband. We find the trial court’s use of this general
language indicates it considered the Advanta line of credit part of the business
indebtedness for which Husband was responsible and apportioned it appropriately as
part of its overall division of martial property.
{¶43} Husband’s first and second assignments of error on cross-appeal are
overruled.
{¶44} The judgment of the Ashland County Court of Common Pleas is affirmed.
By: Hoffman, P.J.
Farmer, J. and
Wise, J. concur
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ Sheila G. Farmer ________________
HON. SHEILA G. FARMER
s/ John W. Wise _____________________
HON. JOHN W. WISE
Ashland County, Case No. 10-CA-015 11
IN THE COURT OF APPEALS FOR ASHLAND COUNTY, OHIO
FIFTH APPELLATE DISTRICT
DAVID ZILKO :
:
Plaintiff-Appellee/Cross-Appellant :
:
-vs- : JUDGMENT ENTRY
:
LISA ZILKO :
:
Defendant-Appellant/Cross-Appellee : Case No. 10-CA-015
For the reasons stated in our accompanying Opinion, the judgment of the
Ashland County Court of Common Pleas is affirmed. Costs assessed to
Appellant/Cross-Appellee.
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ Sheila G. Farmer___________________
HON. SHEILA G. FARMER
s/ John W. Wise______________________
HON. JOHN W. WISE