NO. 91-122
IN THE SUPREME COURT OF THE STATE OF MONTANA
1991
IN RE THE MARRIAGE OF LANA KAY WILSON FRONK,
Petitioner and Appellant,
-vs-
ROBERT LEO WILSON,
Respondent and Respondent.
APPEAL FROM: District Court of the Fifteenth Judicial District,
In and for the County of Roosevelt,
The Honorable M. James Sorte, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Carol C. Johns, Attorney at Law, Wolf Point,
Montana.
For Respondent:
David L. Irving, Attorney at Law, Glasgow, Montana.
Submitted on briefs: September
- 12, 1991
Decided: October 29, 1991
Chief Justice J. A . Turnage delivered the Opinion of the Court.
Lana Kay Wilson Fronk appeals from an order of the District
Court of the Fifteenth Judicial District, Roosevelt County, which
increased both the child support obligation and the visitation
rights of her daughter's father, Robert Leo Wilson. We affirm in
part and reverse in part.
The issues are:
1. Did the trial court abuse its discretion in failing to set
aside the default on the counterclaim?
2. Did the court err in setting Wilson's modified child
support obligation?
3. Should the modification of child support be made retroac-
tive to the date of notice of the motion for modification?
4. Did the court err in adopting Wilson's proposed findings,
conclusions and order?
5. Did the court err in ordering that Wilson may claim the
parties' child as a dependent for income tax purposes?
6. Did the court err in ordering that the parties must each
pay their own attorney fees?
The parties' marriage was dissolved in 1981, when their
daughter Katie Lynn Wilson was one year old. The mother, Lana Kay
Wilson Fronk (Fronk), was given sole custody of the daughter, with
the father, Robert Leo Wilson (Wilson) to have "reasonable rights
of visitation" subject to an injunction pending a psychiatric
2
evaluation. The injunction was lifted in 1983. Wilson was ordered
to pay $150 per month in child support and was made responsible for
the daughter's medical, dental, and optometrical expenses. Both
parties have since remarried. At the time of these proceedings,
Fronk lived in Utah and Wilson lived in Alaska.
In January 1990, Fronk filed a petition for modification of
the decree of dissolution, requesting that the amount and duration
of child support payments be increased. Wilson filed an answer and
counterclaim requesting that visitation be specified, that each
party be responsible for his or her own attorney fees, and that he
be allowed to take the income tax deduction for the child.
Following discovery, Fronk noticed a hearing on child support
for October 2, 1990. On September 27, 1990, on Wilson's motion,
the court continued that hearing indefinitely. On the same day,
and also on Wilson's motion, the court entered a default judgment
for Wilson on his counterclaim.
Fronk moved to set aside the default judgment. The court
heard argument on that motion at a November 7, 1990, telephone
conference at which the support issues were also argued.
On January 18, 1991, the court entered its findings, con-
clusions, and "decree of dissolution.1f The court increased
Wilson's support obligation to $241 per month until the child is
twelve years old and to $298 per month thereafter until she is
emancipated. It made no statement finding Fronk properly in
3
default or denying her motion to have the default set aside, but it
adopted Wilson's proposals as to the issues raised in the counter-
claim. It set Wilson's visitation rights as, at a minimum, one
visit per year at his residence for at least eight consecutive
weeks during the summer. The court also ordered that Wilson shall
be allowed to claim his daughter as a dependent for income tax
purposes and that each party shall pay his or her own attorney fees
incurred in this action.
I
Did the trial court abuse its discretion in failing to set
aside the default on the counterclaim?
It is undisputed that Fronk did not file an answer to Wilson's
counterclaim. The grounds upon which she moved to set aside the
default judgment were that it was not entered in accordance with
the requirements of Rule 55(b) (2), M.R.Civ.P.; that her attorney
had requested of Wilson's attorney that the issue of child support
be resolved before the issue of visitation was addressed: and that
Wilson's attorney was aware of Fronk's objections to the terms
requested in the counterclaim. When the motion to set aside the
default was argued in the November 7, 1990, telephone hearing, the
position of Fronk and her counsel was that the issue was Itamatter
of law and a question of procedure." The District Court agreed,
and the merits of the counterclaim were not argued.
Rule 55(b)(2), M.R.Civ.P., provides that
4
[i]f the party against whom judgment by default is sought
has appeared in the action, the party (or, if appearing
by representative, the party's representative) shall be
served with written notice of the application for
judgment at least 3 days prior to the hearing on such
application.
In September of 1990, Fronk's attorney was served with both the
application for entry of default and the default entered by the
district court clerk. In November of 1990, a hearing was held
which included argument on setting aside the default. No judgment
was entered on the counterclaim, the subject of the default, until
January 18, 1991. We conclude that no violation of Rule 55(b)(2),
M.R.Civ.P., has been shown.
Rule 55(c), M.R.Civ.P., provides that for "good cause" shown,
a district court may set aside an entry of default. To determine
the existence of good cause, courts should consider whether the
default was willful, whether the party on whose behalf the default
was entered would be prejudiced if the default were set aside, and
whether the party against whom the default was entered has present-
ed a meritorious defense to the claims against it. Cribb v.
Matlock Communications, Inc. (1989), 236 Mont. 27, 30, 768 P.2d
337, 339. Appellate courts reverse refusals to set aside entries
of default on a showing of slight abuse of discretion by the lower
court. Cribb, 768 P.2d at 340.
There was no evidence before the District Court that Fronk's
default was willful. The prejudice to Wilson if the default is set
5
aside is limited because visitation is to occur only once a year,
in the summer months. As a result of her position that the entry
of default should be set aside as a procedural matter, Fronk did
not present all of her arguments on the counterclaim prior to entry
of judgment. However, she did submit affidavits alleging physical
and sexual abuse, in support of her position on the issue of
visitation. After consideration of the factors set forth in Cribb,
we conclude that the lower court abused its discretion in failing
to set aside the default. We reverse on this issue and remand for
further proceedings before the District Court.
Issues 5 and 6 relate to other parts of the counterclaim.
Because we reverse on the failure to set aside the default on the
counterclaim, those issues, too, must be reconsidered on remand.
Therefore, we will not discuss Issues 5 and 6.
I1
Did the court err in setting Wilson's modified child support
obligation?
Wilson concedes Fronk's point that a clerical error was made
in calculating his net available resources to be considered in
setting the amount of child support. He recalculates his net
amount of available resources as $31,489, resulting in a monthly
support obligation of $356.88 until the child reaches twelve years
of age and $440.85 thereafter until she is emancipated. Both
parties point out that the District Court can correct the miscal-
6
culation as a clerical mistake pursuant to Rule 60(a), M.R.Civ.P.
We agree. This recalculation should be retroactive to the date of
the judgment from which this appeal is taken and should be included
in the District Court's findings and conclusions on remand.
Fronk asserts that, in calculating Wilson's child support
obligation, the District Court permitted him an excessive deduction
for the cost of living in Alaska. The Montana child support
guidelines do not address a cost of living adjustment. But, as
Wilson points out, this Court has stated that "[i]n appropriate
cases, where there is evidence presented that shows there is
substantial disparity between the value of the dollar in different
locales, the Court may in equity need to make appropriate adjust-
ments." In re Marriage of Mitchell (1987), 229 Mont. 242, 249- 50,
746 P.2d 598, 603. We hold that consideration of such a factor is
not in itself an abuse of discretion.
The record indicates that the American Chamber of Commerce
Researchers Association (ACCRA) Cost of Living Index, which was
introduced into evidence by Wilson and upon which the court based
its cost of living adjustment, was obtained from the State of
Montana's Census and Economic Information Center. We hold that the
ACCRA index is a public record admissible into evidence under Rule
803(8), M.R.Evid. Additionally, Wilson gave several examples of
how he is personally affected by the high cost of living in Alaska.
We hold that the allowance of a 26 percent cost of living adjust-
7
ment calculated from the ACCRA Cost of Living Index does not
represent reversible error.
Fronk also contends that the District Court erred in allowing
Wilson a deduction for federal income tax of $4,420, the amount
withheld from his paycheck. She argues that the amount of his
annual income tax refund should be subtracted from the amount
allowed as a deduction. The Montana child support guidelines
require income to be calculated on the basis of disposable income.
The District Court is in the best position to determine whether tax
returns or payroll checks accurately reflect disposable income. We
conclude that no reversible error has been shown.
Finally, Fronk argues that if the District Court considers
Wilson's new family when determining his obligation to support his
first child, then it should also consider his new wife's income and
contributions. However, the District Court's findings do not
indicate that Wilson's financial responsibility to support his new
family was used as a separate factor in calculating his child
support obligation.
I11
Should the modification of child support be made retroactive
to the date of notice of the motion for modification?
Fronk points out that the District Court has the power, under
3 40-4-208(1), MCA, to modify the amount of any child support
installments accruing subsequent to actual notice ofthe motion for
8
modification. She argues that, due to her financial need, the
delays in these proceedings caused by Wilson, and the "unconsciona-
bly" low child support prior to modification, she is entitled to
modified child support retroactive to the date Wilson was served
with the petition for modification. Her proposed findings,
conclusions, and order reflected that position and provided that
the increased child support would be effective February 5, 1990.
Section 40-4-208(1), MCA, does not mandate that modifications
of child support must be made retroactive to the date of notice of
the motion for modification. Rather, it sets a limit as of that
date. We hold that no abuse of discretion has been shown in the
District Court's prospective modification of the amount of child
support.
IV
Did the court err in adopting Wilson's proposed findings,
conclusions and order?
Fronk argues that the record does not support the District
Court's verbatim adoption of Wilson's proposed findings, con-
clusions, and order. To the extent that the court's judgment is
reversed under Issue 1 above, this issue is moot.
A s to the remaining findings, Fronk objects to finding #21:
[Wilson] testified that a college education is a privi-
lege, not a right or endowment, and that any payments he
might make would be based upon a decision to make a
personal gift to his child based upon meritorious
achievement and the child's ability and willingness to
9
attend college, rather than required as if a "reward"
simply because [Fronk] and [Wilson] were divorced.
Wilson did not so testify. While we must caution the District
Court to use discretion in adopting proposed findings, we hold that
the presence of the above finding does not constitute reversible
error. We note that under § 40-4-208(5), MCA, any provision for
child support following the child's emancipation or graduation from
high school is the exception, not the norm.
Affirmed as to the issue of child support except for correc-
tion of the clerical error in calculating the amount of that
support, and reversed and remanded as to the issues raised in
Wilson's counterclaim.
10
October 29, 1991
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the following
named:
CAROL C. JOHNS
Attorney at Law
P.O. Box 995
Wolf Point, MT 59201
DAVID L. IRVING
Attorney at Law
Drawer B
Glasgow, MT 59230
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA