Gladis v. Gladisova

*674RAKER, J., dissenting, in which HARRELL, J.,

joins:

I respectfully dissent from the Court’s holding that the Maryland Child Support Guidelines are applicable in determining the appropriate child support obligation of the noncustodial parent when the custodial parent and the child live outside the United States. In my view, the guidelines are irrelevant under these circumstances; therefore, the court should determine the appropriate child support without reference to the guidelines.

The Circuit Court for Baltimore City applied the guidelines to determine Mr. Gladis’s child support obligation to Ms. Gladisova, who lives in the Slovak Republic with the parties’ daughter, Ivana. Upon examining the underlying principles and the purpose of the guidelines, I conclude that the Legislature did not intend for the guidelines to be applied when the custodial parent resides outside of the United States. I agree with the arguments of Mr. Gladis that the guidelines do not apply outside of the United States, and that even if they do apply, it is unjust and inappropriate to apply them in the instant case because of the great disparity in the cost of living between the United States and the Slovak Republic.

I.

The Child Support Guidelines were enacted in 1989 to comply with federal law and regulations. See Voishan v. Palma, 327 Md. 318, 322, 609 A.2d 319, 321 (1992). The federal law required that the guidelines be enacted and that they be based on specific descriptive and numeric criteria and result in a computation of the support obligation. Id. at 322, 609 A.2d at 321. When originally enacted, the guidelines were advisory, see 1989 Maryland Laws ch. 2 § 12-202(c), at 12, but became mandatory in 1990. 1990 Maryland Laws ch. 58 § 12-202(a)(1), at 400 (codified as amended at Maryland Code (1984, 1999 Repl.Vol., 2003 Cum.Supp.) §§ 12-201-12-204 of the Family Law Article). A court is required to utilize the child support guidelines in setting child support obligations; there is a rebuttable presumption that the support award based *675upon the application of the guidelines is correct. FL § 12-202. Drummond v. State, 350 Md. 502, 511-12, 714 A.2d 163, 168 (1998). This presumption can be rebutted by evidence that applying the guidelines would be unjust or inappropriate in a particular case.

The guidelines are based on the principle that “a child should receive the same proportion of parental income, and thereby enjoy the standard of living, he or she would have experienced had the child’s parents remained together.” Voishan, 327 Md. at 322, 609 A.2d at 321. In developing the guidelines, the Maryland Senate Judicial Proceedings Committee used the “Development of Guidelines For Child Support Orders: Advisory Panel Recommendations and Final Report” promulgated by the United States Department of Health and Human Services’ Office of Child Support Enforcement. Id. According to this report, the purpose and need for the guidelines was “(1) to ‘remedy a shortfall in the level of awards’ that do not reflect the actual cost of raising children, (2) to ‘improve the consistency, and therefore the equity, of child support awards,’ and (3) to ‘improve the efficiency of court processes for adjudicating child support.’ ” Id. at 322, 609 A.2d at 321. Additionally, the Legislature intended to “limit the necessity of the court to make those findings of fact required in existing case law ... except to the extent they may be applicable under subsections (a)(2)(h), (iii) and (iv) of § 12-202.” Gates v. Gates, 83 Md.App. 661, 666, 577 A.2d 382, 385 (1990).

The General Assembly developed a schedule of basic child support obligations which is included in the guidelines. See § 12-204(e) of the Family Law Article. The basic child support obligation is determined in accordance with the schedule of basic child support obligations set forth in § 12-204. The schedule establishes child support obligations only for those parents having a combined monthly adjusted actual income of $10,000 or less. If the parents combined adjusted actual income exceeds that level, the court may use discretion in setting the amount of child support.

*676The General Assembly developed the schedule based on the Income Shares Model. Voishan, 327 Md. at 322, 609 A.2d at 321. The Income Shares Model “establishes child support obligations based on estimates of the percentage of income that parents in an intact household typically spend on their children.” Id. at 322-323, 609 A.2d at 321. “The economic assumptions underlying this model are based on recent studies estimating expenditures on children as a proportion of household consumption.” Id. at 334, 609 A.2d at 327 (McAuliffe, J., concurring).

The General Assembly contemplated that in certain situations use of the guidelines would be inappropriate. Section 12-202(a)(2)(i) establishes a rebuttable presumption that the amount of child support which would result from the application of the guidelines is the correct amount. Section 12-202(a)(2)(ii) provides that the presumption may be rebutted by evidence showing that the application of the guidelines would be unjust or inappropriate in a particular case. The guidelines set out a non-exhaustive list of factors that the court can consider in determining whether the use of the guidelines is unjust or inappropriate. See § 12-202(a)(2)(iii)(l)(2).

If the court finds that it is unjust or inappropriate to apply the guidelines in a particular case, the court must state on the record its reasons for departing from the guidelines. § 12-202(a)(2)(iv). In this situation, the court must formally state:

A. the amount of child support that would have been required under the guidelines;
B. how the order varies from the guidelines;
C. how the finding serves the best interests of the child; and
D. in cases in which items of value are conveyed instead of a portion of the support presumed under the guidelines, the estimated value of the items conveyed.

§§ 12-202(a)(2)(iv)(2).

II.

A review of the underlying purpose of the guidelines indicates to me that the General Assembly did not intend them to *677be applicable when the custodial parent and child are living outside of the United States. The General Assembly enacted the guidelines because it wanted, inter alia, to remedy situations in which the court was awarding the custodial parent far less in child support than the parent’s actual costs of raising the child. Voishan, 327 Md. at 322, 609 A.2d at 321. The guidelines were enacted to ensure that the custodial parent receive an amount of child support consistent with the actual monthly costs of raising the child. I believe the Legislature intended the guidelines to address only those child support awards made for children who reside within the United States.

The underlying principles of the Income Shares Model which the schedule is based upon reveal that the General Assembly did not intend for the court to apply the guidelines in cases where the custodial parent lives abroad. The Income Shares Model “establishes child support obligations based on estimates of the percentage of income that parents in an intact household typically spend on their children.” Voishan, 327 Md. at 322-323, 609 A.2d at 321. The estimates “are based on recent studies estimating expenditures on children as a proportion of household consumption.” Voishan, 327 Md. at 334, 609 A.2d at 327 (McAuliffe, J., concurring).

It is not plausible that the General Assembly, in developing the schedule, researched or took into account the percentage of income that parents living in different countries spend on their children. It is more reasonable to assume that the statistics the General Assembly examined contained information about how much parents in the United States spend on their children as a proportion of their household consumption. It is hard to believe that the assumptions underlying the “Income Shares Model” establishing child support obligations on the percentage of income that parents in an intact household typically spend on their children and the studies estimating expenditures on children as a proportion of household consumption considered data outside the United States. Even though there is disparity in the cost of living within jurisdictions in the United States, and the guidelines do apply where the non-custodial parent resides outside Maryland but within *678the United States, it is unrealistic to attempt to equalize standards of living throughout the entire world and, in my view, the Legislature did not attempt to do so.

Applying the guidelines to the instant case results in Ms. Gladisova receiving significantly more in child support payments than Ivana’s actual monthly costs. Ivana lives with her mother in the Slovak Republic,1 where the average cost of living is much lower than in Maryland or in the United States. The Master found that the cost of raising children in the Slovak Republic is very disparate from the cost of raising children in the United States. Although Ivana’s monthly expenses are disputed, there is no disagreement that they are below $280.2 According to the schedule in the guidelines, Mr. Gladis is required to pay Ms. Gladisova $497 per month in child support.

III.

Mr. Gladis contends that, even if the guidelines do apply when the child resides outside the United States, the Circuit Court abused its discretion in not deviating from them based on the extreme economic disparity between the United States and the Slovak Republic. Child support awards made pursuant to the guidelines will be disturbed only if there is clear abuse of discretion. Voishan, 327 Md. at 331, 609 A.2d at 326. Mr. Gladis contends that his $497 monthly obligation, as derived from the guidelines, is “unjust and inappropriate” because the monthly cost of raising Ivana in the Slovak Republic is the equivalent of only $233.

*679Ms. Gladisova maintains that the guidelines do not allow for deviation merely because the custodial parent lives in a country with a different standard of living. Moreover, Ms. Gladisova maintains that the Circuit Court’s application of the guidelines does not create an unjust or inappropriate child support obligation because the amount neither excessively burdens Mr. Gladis, nor inappropriately enriches the child. Ms. Gladisova maintains that the guidelines do not permit deviation because the guidelines are based on the principle that a child is entitled to a standard of living that corresponds to the economic position of the parents. She argues that based on this principle, Mr. Gladis should pay the amount stipulated by the guidelines — even though it is greater than Ivana’s actual costs — because he has a higher standard of living in the United States than Ivana has in the Slovak Republic.

Section 12 — 2Q2(a)(2)(ii) permits the court to deviate from the guidelines if it finds that they would dictate an unjust or inappropriate award. Although § 12-202(a)(2)(iii) sets forth some factors which the court “may consider” in “determining whether the application of the guidelines would be unjust or inappropriate in a particular case,” the use of “may” indicates that the Legislature did not intend this list to be exhaustive. There is nothing in the statutory language itself that supports Ms. Gladisova’s contention that the court is forbidden from considering an international disparity in child-rearing costs as a factor in determining the appropriateness of a Guideline award.

Ms. Gladisova argues that this case is analogous to the circumstances in Smith v. Freeman, 149 Md.App. 1, 814 A.2d 65 (2002). In Smith, the custodial mother sought an increase in the father’s child support obligation not because the child’s needs had increased, but because the father’s salary as a professional football player had increased by two million dollars. Id. at 21, 814 A.2d at 77. The court granted the mother’s modification request on the principle that the child is entitled to a standard of living that corresponds to the parents’ economic position, and that had the parents remained *680together, the child would have enjoyed a better lifestyle. Id. at 23, 814 A.2d at 78.

The instant case is distinguishable from Smith. In Smith, had the parents remained together, the child would have enjoyed a much higher standard of living because of her father’s high salary increase. Id. at 32-33, 814 A.2d at 83. In the case sub judice, had Mr. Gladis and Ms. Gladisova remained together, Ivana would not have had a higher standard of living than she does currently. Mr. Gladis earns $42,000 per year and lives a modest and comfortable life with his new wife and seven-month old daughter. Had Mr. Gladis and Ms. Gladisova remained together, in either the United States or the Slovak Republic, they would have lived a lifestyle commensurate with the standards of the country in which they resided and not one considered luxurious by the local standard. Ivana currently lives a life that is more comfortable than that of most people in the Slovak Republic.3 If Mr. Gladis is required to pay the amount stipulated by the guidelines, Ivana will have the financial ability to live a life of luxury in the Slovak Republic as compared to the ordinary standard of living in that country. Therefore, following the guidelines and giving Ms. Gladisova significantly more than her actual costs of raising Ivana is contrary to the principle that the child is entitled to the standard of living that she would have enjoyed had the parents remained together.

Even if we ignore the difference between the material expectations held by residents of Maryland and the Slovak Republic, the Circuit Court appears to have ignored the effect of purchasing power differentials. In doing so, it conflated cost of living with standard of living. The same bundle of goods and services which would constitute a middle class *681standard of living in Maryland could be purchased at significantly lower cost in the Slovak Republic. Exporting Mr. Gladis’s U.S. dollars to the Slovak Republic and exchanging them for crowns greatly increases their purchasing power. Because she happens to be shopping in the Slovak Republic, Ivana can purchase more skis, bicycles, lessons, and insurance policies with her father’s dollars than she could at Maryland prices. It is unjust to provide her (and her mother) this windfall at her father’s expense, merely because Mr. Gladis happens to live in a country with a higher cost of living.

The application of the guidelines is unjust and unfair. In People ex rel. A.K., 72 P.3d 402, 404 (Colo.App.2003), the noncustodial parent argued that the court should deviate from the Colorado child support guidelines because the children lived in Russia, where their economic circumstances were “very different from those on which the guidelines are based.” People ex rel. A.K., 72 P.3d at 404. The court found that the trial court erred in not considering whether the differing living expenses in Colorado and Russia would render applying the guidelines “inequitable, unjust, or inappropriate” and remanded the case to the trial court for this consideration. Id. at 405. In Booth v. Booth, 44 Ohio St.3d 142, 541 N.E.2d 1028 (1989), the court reviewed an award of child support and addressed whether the trial court could deviate from applying the child support guidelines based on the parents’ widely differing costs of living in New York and Ohio. The court found that the trial court did not abuse its discretion in deviating from the guidelines. See Booth, 541 N.E.2d at 1030. The court further stated:

If we were to assume, arguendo, that the trial court had failed to consider the respective costs of living of the parties, it may have indeed been “unreasonable” for the court to ignore such economic realities and, thus, the child support order might have amounted to an abuse of discretion.

Id. at 1030 (emphasis in original).

The instant case is similar to the situation in A.K. and Booth because of the disparity in the cost of living between the *682United States and the Slovak Republic. Based on this disparity, it is unjust and inappropriate for the court to apply the guidelines strictly.

IV.

The court should determine the appropriate amount of child support in this case without reference to the guidelines. In determining the appropriate amount of child support, the court should consider the needs of the particular child, the child’s station in life, and the financial circumstances of the non-custodial parent. See Wagshal v. Wagshal, 249 Md. 143, 147-48, 238 A.2d 903, 906 (1968). The court should determine Mr. Gladis’s child support obligation by balancing the best interests and the needs of Ivana with Mr. Gladis’s financial ability to meet them. See Unkle v. Unkle, 305 Md. 587, 597, 505 A.2d 849, 854 (1986); Rothschild v. Strauss, 257 Md. 396, 398, 263 A.2d 511, 512 (1970); Wagshal v. Wagshal, 249 Md. 143, 147-48, 238 A.2d 903, 906 (1968). In applying the balancing test, the court should consider the needs of the child along with factors such as “the financial circumstances of the parties, their station in life, their age and physical condition, and expenses in educating the children.” Unkle, 305 Md. at 597, 505 A.2d at 854; see also Kramer v. Kramer, 26 Md.App. 620, 636, 339 A.2d 328, 339 (1975); Bowis v. Bowis, 259 Md. 41, 43, 267 A.2d 84, 85 (1970); Chalkley v. Chalkley, 240 Md. 743, 744, 215 A.2d 807, 808 (1966).

I emphasize that while the discussion, supra, makes reference to the inequity of requiring Mr. Gladis to fund his daughter’s comparatively privileged lifestyle in the Slovak Republic, I do not dissent because of the particular consequences in this case. Rather, my opinion is founded squarely on my belief that the Legislature could not have acted with the purpose of equalizing living standards when it adopted the guidelines. If Ivana lived in Monaco or Switzerland, I would find it equally appropriate for the Circuit Court to order a support award greater than that reflected under the guidelines to accommodate the higher actual costs of child-rearing in those countries relative to Maryland.

*683The court should not apply the guidelines in a situation where the custodial parent lives outside of the United States. Perhaps the Legislature will revisit the guidelines and make clear that they are inapplicable when the non-custodial parent lives outside of the United States.

Judge HARRELL has authorized me to state that he joins in this dissenting opinion.

. The Master found that according to a Slovak Republic government resource, the Slovak Republic the average gross expenses per household in 2001 were the equivalent of $168.80 per year. The definition of household was not provided.

. Throughout the proceedings below, there have been several different estimates of Ivana’s monthly costs. The Master found her monthly costs to equal $275.88, Judge Hargadon found it to be $251.75, the State believes that it is $243.45 and Mr. Gladis believes that it is $233.00.

. The Master's findings in the proceedings below showed that Ivana has health insurance through her mother’s employer, whereas most people in the Slovak Republic pay for medical services as they are rendered. Ms. Gladisova also has a vehicle, whereas the majority of the population in the Slovak Republic travels by public transportation. Furthermore, Ivana regularly attends dance and music lessons and has skis, a bicycle and an organ.