This is an appeal from a judgment of the Jackson County Court of Common Pleas modifying the child support payments made by Joseph J. Riepenhoff. We reverse.
The record reveals the following facts. The parties were divorced in 1982. Dorothy Riepenhoff (now Trace) received custody of the parties' four minor children. The court ordered Riepenhoff to pay $570 per month for child support. At the time of the divorce, Riepenhoff was president and owner of one hundred seventeen shares of stock of Wellston Bottling Company, a closely held Sub-Chapter S corporation. Riepenhoff received a salary from the corporation but was also entitled to a portion of the earnings of the *Page 137 corporation. These earnings however were retained in the corporation and not distributed.
In February 1986, the oldest of the parties' four children elected to live with his father. On July 16, 1987, Trace filed a motion to modify Riepenhoff's child support obligation and change custody of the eldest child since the child had elected to again live with his mother.
On November 30, 1987, the trial court filed its entry granting Trace's motion to modify Riepenhoff's child support obligation and ordered Riepenhoff to pay $239 per week until the oldest child, Arthur Riepenhoff, became emancipated. At that time, Riepenhoff's support obligation would again be modified. The trial court also stated that Riepenhoff's gross income would be deemed to include his salary plus one half of the retained Sub-Chapter S corporation earnings.
On October 3, 1988, the trial court again modified Riepenhoff's child support obligation, decreasing it to $238 per week for the support of three children. The trial court arrived at the above figure by taking Riepenhoff's salary of $52,000, adding to it half of Riepenhoff's retained earnings in the Sub-Chapter S corporation, $9,000 for a total gross income of $61,000, and applying the rest of the Supreme Court guidelines to that $61,000 figure.
After the trial court filed its order in the matter, Riepenhoff requested findings of fact and conclusions of law. On October 17, 1988, the trial court held that Riepenhoff was not entitled to findings of fact and conclusions of law but suasponte attached its November 30, 1987 decision which fully set forth the facts and law applicable to the case before it.
Riepenhoff appeals and assigns two errors.
The purpose of Civ.R. 52 is set out in In re Adoption ofGibson (1986), 23 Ohio St.3d 170, 23 OBR 336, 492 N.E.2d 146, where the Supreme Court held:
"The purpose of the rule is therefore clear: to aid the appellate court in reviewing the record and determining the validity of the basis of the trial court's judgment."
When a party requests findings of fact and conclusions of law, he cannot complain of error or prejudice when the court sets forth its findings of fact and conclusions of law in a written opinion. Reenan v. Klein (1981), 3 Ohio App.3d 142, 3 OBR 160, 444 N.E.2d 63. *Page 138
Here, although the trial court did not file findings of fact and conclusions of law per se, it did in fact attach its November 30, 1987 decision in which the court determined the facts of the case and set out the law applicable to the case.
Riepenhoff has not demonstrated that he was prejudiced by the court's denial of his request. Riepenhoff's first assignment of error is not well taken and is overruled.
Riepenhoff asserts that his retained earnings held by the corporation should not have been included as part of his gross income when calculating his child support payments. We agree.
It appears from the record that the trial court judge included half of Riepenhoff's retained earnings in the Sub-Chapter S closely held corporation because those earnings were taxed by the Internal Revenue Service as part of his gross income. While we agree that those retained earnings are taxed by the IRS, we believe that the trial court failed to consider the machinations necessary for those earnings to be distributed to Riepenhoff. Section 1368(e)(3), Title 26, U.S. Code, provides that such distributions may be made, but that in order to do so it must be done with the consent of all affected shareholders. Here, Riepenhoff owns only forty-seven percent of the stock in the corporation. Thus, if all other stockholders voted against such a distribution, Riepenhoff's request for a distribution of funds would be defeated. The money retained in the corporation is clearly not available to Riepenhoff merely upon request. The trial court erred in including those earnings in Riepenhoff's gross income.
It is highly inequitable to include retained earnings as income. The shareholder has to pay taxes out of his other income and thus has less disposable income available for child support. If on top of this loss of disposable income, the shareholder is required to pay additional child support out of money he has not received, the non-custodial parent may find himself without adequate means for his own support. We would add parenthetically that though this case deals with a closely held corporation, the trial court's ruling here would equally apply to retained earnings of a publicly traded corporation. Appellant's second assignment of error is well taken and is sustained. *Page 139
Our holding in this case must not be construed to mean that an individual ordered to pay child support or alimony may use a closely held corporation as a dodge to shelter his income to avoid paying a higher amount of support or alimony. On the facts here, however, it is evident from the record that the plan to retain earnings within the corporation existed during the marriage and before the Riepenhoffs filed for divorce. Clearly here, there has been no attempt to shelter Riepenhoff's retained earnings in an effort to reduce his alimony obligations. Thus, we reverse the trial court's decision below and remand this cause for a recalculation of Riepenhoff's child support obligation, consistent with this opinion.
Judgment reversedand cause remanded.
HARSHA, J., concurs.
HOMER E. ABELE, P.J., dissents.