COURT OF APPEALS, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 72156 DOLORES H. FREDERICK : : : JOURNAL ENTRY PLAINTIFF-APPELLANT : : AND v. : : OPINION JAMES A. FREDERICK : : : DEFENDANT-APPELLEE : DATE OF ANNOUNCEMENT OF DECISION: FEBRUARY 26, 1998 CHARACTER OF PROCEEDING: Civil appeal from Domestic Relations Court, No. D-198511. JUDGMENT: AFFIRMED. DATE OF JOURNALIZATION: APPEARANCES: For Plaintiff-Appellant: Joyce E. Barrett, Esq. 800 Standard Building 1370 Ontario Street Cleveland, OH 44113 For Defendant-Appellee: Joseph Bancsi, Esq. 20545 Center Ridge Road, No. 409 Rocky River, OH 44116 -2- TIMOTHY E. MCMONAGLE, J.: Dolores H. Frederick ( appellant ) appeals from the judgment of the Cuyahoga County Court of Common Pleas, Domestic Relations Division wherein the court granted James A. Frederick's ( appellee ) motion to modify spousal support. Appellant contends that the trial court abused its discretion when it decreased the amount of spousal support asserting that the record does not reflect a change of circumstance warranting a reduction of spousal support. Finding no reversible error in the proceedings below we affirm. The facts relevant to the issues in this appeal are as follows. Appellant, Dolores H. Frederick and appellee, James A. Frederick, were married on August 30, 1952 and were granted a divorce March 29, 1991. Pursuant to the judgment entry, appellee agreed to pay $3,000 plus two percent poundage per month as spousal support until [appellant] shall die or remarry, or until [appellee] shall die, subject to further order of this Court to modify this provision upon changed circumstances. On January 22, 1993 appellee was found in contempt of court and in arrears in the amount of $4,717.50, including statutory interest from March 29, 1991 through July 31, 1992, and was sentenced to thirty days in jail or, alternatively, to two hundred hours of community service. Further, the court provided that if appellee were to pay an additional $1,572.50 per month toward the arrearage in December 1992 and January and February 1993 the sentence would be suspended. -3- Appellee failed to make the additional payments and performed two hundred hours of community service. On March 21, 1994, after hearings on post-judgment motions, the court entered an interim order awarding a lump sum judgment of $5,425.12 to appellant for the arrearages accrued prior to August 1, 1992; attorney's fees in the amount of $4,250; and, granted appellee's motion to modify spousal support by reducing the monthly obligation to $1,900. On July 15, 1994 the court overruled appellee's objections to the report and the interim order was made final. On November 14, 1995 the court, finding appellee in arrears of $9,819 in the payment of spousal support from January 4, 1994 through March 31, 1994 and $4,400 from November 1, 1994 through March 31, 1995, determined that appellee was in contempt for a second time and sentenced him to sixty days in jail or alternatively, to perform four hundred hours of community service. Appellee failed to comply with the court's order. On January 7, 1996 and continued to April 19, 1996, a hearing was held on outstanding post-decree motions, including appellee's motion to modify or terminate spousal support, appellant's motion to show cause and appellant's request for attorney's fees. Appellant and appellee each testified and was cross-examined. Appellant's counsel testified on the issue of attorney's fees. The record reveals that appellee is a sixty-nine-year-old self-employed electrical designer who, due to a heart attack and open heart surgery in 1995, has reduced his working hours from -4- sixty or seventy hours per week to approximately forty hours per week. Prior to his heart attack, appellee's taxable income according to IRS filing was $63,553.21 in 1994, and $73,507.70 in 1995. Appellee demonstrated gross receipts of $20,137.36 for the first quarter of 1996 resulting in an estimated gross income of $80,550 for 1996. Appellee claims annual business expenses averaging $30,000-$40,000. These figures evidence a projected 1996 taxable income of $40,000-$50,000, a decrease of income from 1994. Appellee testified that the increase in his income for 1995 was due to a one-time large contract which generated revenues of over $70,000 and was substantially completed before his heart attack in August, 1995. Further, however, as a result of these increased revenues, he is required to pay back over $25,000 Social Security benefits received. Finally, the evidence showed that appellee's business expenses for his insurance have increased an additional $6,000 annually. Appellant is sixty-seven years old and lives in the former marital home with her two adult sons and daughter-in-law. She receives $473 per month in Social Security benefits. She claimed monthly expenses of approximately $2,400, a decrease from her previously claimed monthly expenses of $3,300. She testified that she has additional expenses for debt payments to friends because she has borrowed money. Appellant conceded that despite the fact that three employed adults live with her in the home, she receives no financial contribution toward household expenses, utilities, food or taxes from them. -5- On July 5, 1996 the magistrate issued Findings of Fact and Conclusions of Law, finding inter alia that appellee is working to his capacity but his capacity has lessened since the divorce resulting in a change of circumstance necessitating a modification of spousal support. The magistrate further found that upon consideration of all factors cited in R.C. 3105.18, appellee's obligation for spousal support should be reduced to $1,000 per month commencing in 1996. On appellant's motion to show cause the magistrate found appellee in contempt of court for his failure to abide by the prior orders to maintain payments in full and payments on the arrearage. The magistrate granted appellant's motion for attorney's fees in the amount of $2,000. Appellant timely filed her objections to the magistrate's report. The court, on February 24, 1997, modified the lump sum payment awarded to appellant and adopted the magistrate's decision. Appellant timely appealed and advances a single assignment of error for our review. THE TRIAL COURT ERRED AND ABUSED ITS DISCRETION IN MODIFYING APPELLANT'S SPOUSAL SUPPORT. Appellant contends that the trial court abused its discretion when it modified the spousal support because the record in this case is void of any substantive reason for decreasing spousal support. We do not agree. R.C. 3105.18(E) provides that spousal support may be modified upon a change in circumstance and provides: (F) For purposes of divisions (D) and (E) of this section, the change in the circumstances of a party includes, but is not limited to, any increase or involuntary -6- decrease in the parties' wages, salary, bonuses, living expenses, or medical expenses (Emphasis added.) It is well settled that our review of the trial court's decision to modify alimony payments is limited to a review of whether the trial court abused its discretion. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217. This standard requires us to affirm the decision of the lower court unless we find that the lower court's attitude was unreasonable, arbitrary or unconscionable. Kahn v. Kahn (1987), 42 Ohio App.3d 61. In order to modify spousal support, the trial court first must determine whether there has been a change of circumstance not contemplated at the time of the prior order. R.C. 3105.18(E); see also, Leighner v. Leighner (1986) 33 Ohio App.3d 214. The record reveals that appellee is a sixty-nine-year-old self-employed electrical designer who, due to a heart attack and subsequent open heart surgery in 1995 has had to reduce his working hours due to his fatigue and lack of energy from his previous workload of sixty to seventy hours per week to approximately forty hours per week, about a 33-1/3 percent reduction. The magistrate in her comprehensive report stated that: appellee is working to his capacity, but his capacity has lessened since the divorce. In conclusion, a change of circumstances has occurred necessitating a modification of spousal support in this matter. We find the magistrate's conclusion that a change of circumstance warranting modification had occurred was supported by the evidence presented -7- and we further find that the trial court's determination was well reasoned and neither arbitrary nor unconscionable. Consequently, we find no abuse of discretion in this first determination of the lower court. After finding a change of circumstance existed, the lower court modified the spousal support by reducing the monthly amount of the obligor-appellee from $1,900 to $1,000 per month. We review this modification to determine whether the trial court abused its discretion. Appellant contends that where the evidence demonstrated an increase in the appellee's income it was error for the trial court to decrease spousal support arguing that it seems logical that if the first decrease in spousal support was based upon a decrease in appellee's income, then any subsequent reductions should be likewise based. We do not agree. Where a change of circumstance has been found to exist, the trial court's discretion in modifying the amount of spousal support is guided by the relevant factors as outlined in R.C. 3105.18 which provides the following factors to be considered: (C)(1)(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 [3105.17.1] of the Revised Code; (b) The relative earning abilities of the parties; (c) The ages and the physical, mental, and emotional conditions of the parties; (d) The retirement benefits of the parties; (e) The duration of the marriage; -8- (f) The extent to which it would be inappropriate for a party, because he will be custodian of a minor child of the marriage, to seek employment outside the home; (g) The standard of living of the parties established during the marriage; (h) The relative extent of education of the parties; (i) The relative assets and liabilities of the parties, including but not limited to any court-ordered payments by the parties; (j) The contribution of each party to the education, training, or earning ability of the other party, including, but not limited to, any party's contribution to the acquisition of a professional degree of the other party. (k) The time and expense necessary for the spouse who is seeking spousal support to acquire education, training or job experience so that the spouse will be qualified to obtain appropriate employment, provided the education, training, or job experience, and employment is, in fact, sought; (l) The tax consequences, for each party, of an award of spousal support; (m) The lost income production capacity of either party that resulted from that party's marital responsibilities; (n) Any other factor that the court expressly finds to be relevant and equitable. (See, also, Leighner v Leighner, id.) Consequently, although the magistrate found that appellee's income for 1995 had in fact increased, she further found, consistent with the statutory mandate, there are other elements involved in the analysis beyond merely the income figures as presented by the tax returns. The testimony adduced at the -9- hearing indicated that appellee's income increased substantially in 1995 due only to a one-time contract which generated revenues of over $70,000. Further, as a result of these revenues, appellee, during the next two years, will be required to pay back $25,000 Social Security benefits which he had received. Additionally, appellee's gross receipts for the first quarter of 1996 were found to be about $20,000 indicating an annual income of approximately $80,000 resulting in an estimated annual income of $40,000-$50,000 after business expenses are deducted, a decrease from his annual income in 1994 of $63,553.21, about 33-1/3 percent. The evidence supports a finding that appellee's earning capability has decreased due to an involuntary reduction in his working hours caused by a heart condition. Although appellee has a home with a $145,000 mortgage and a $15,000 equity line of credit debt, there is no evidence in the record to support appellant's contention that appellee's ability to pay was diminished due to a voluntary assumption of additional unnecessary debt. The record further reveals that appellant's expenses have decreased since 1994 from $3,300 to $2,400 per month although appellant failed to produce any records to substantiate her expenses. Appellant lives in a fully paid-for home valued at approximately $200,000 and pays all the expenses incurred in the running of the household, despite the fact that three employed adults also live in the house. Appellant maintains an IRA account of $29,000. -10- The record in this matter makes apparent to us that the lower court considered the factors cited in R.C. 3105.18, including but not limited to the income, earning abilities, ages and physical condition, relative assets of the parties and those other factors which it determined to be relevant and equitable, when it found the appellee's obligation for spousal support should be reduced to $1,000 per month. A review of the entire record convinces us that the lower court carefully and with great deliberation evaluated the evidence presented in arriving at its conclusions. We, therefore, find the court did not abuse its discretion when it modified the order of spousal support in favor of the obligor, appellee. Judgment affirmed. -11- It is ordered that appellee recover of appellant his costs herein taxed. The court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this court directing the Domestic Relations Court to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. PORTER, P.J. CONCURS; and ROCCO, J., DISSENTS (WITH DISSENTING OPINION ATTACHED). TIMOTHY E. McMONAGLE JUDGE N.B. This entry is an announcement of the court's decision. See App.R. 22(D) and 26(A); Loc.App.R. 22(B), 22(D) and 26(A); Loc.App.R. 27. This decision will be journalized and will become the judgment and order of the court pursuant to App.R. 22(E) unless a motion for reconsideration with supporting brief, per App.R. 26(A), is filed within ten (10) days of the announcement of the court's decision. The time period for review by the Supreme Court of Ohio shall begin to run upon the journalization of this court's announcement of decision by the clerk per App.R. 22(E). See, also, S.Ct. Prac.R. II, Section 2(A)(1). COURT OF APPEALS OF OHIO EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 72156 DOLORES H. FREDERICK : : Plaintiff-appellant : DISSENTING : vs. : OPINION : JAMES A. FREDERICK : : Defendant-appellee : DATE: FEBRUARY 26, 1998 KENNETH A. ROCCO, J. DISSENTING: I respectfully dissent from the majority's determination. In view of the trial court's granting of a 47% decrease in the amount of spousal support appellee was ordered to pay in spite of a steady increase in appellee's gross business income, and, considering appellee's complete disregard of the lower court's orders,1 I 1 the parties received their divorce, appellee had aAt the time greed, in writing, to pay spousal support to appellant in the sum of $3,000 per month. Soon afterward, however, appellee moved to modify the amount of support he was required to pay. Although the trial court determined that appellee was in arrears and was in contempt of court, the trial court nevertheless granted appellee's motion to modify spousal support and reduced his obligation to $1,900 per month. Incredibly, in spite of this 36 2/3% reduction in the amount of his obligation, and the fact that appellee's income continued to increase, appellee's arrearages continued to accrue. In fact, after the trial court granted appellee's initial motion to modify, appellee paid only, on average, approximately half of what he owed. Furthermore, appellee never served his outstanding sentence for contempt. In spite of his continued defiance of court orders, the trial court still granted appellee an additional reduction in the amount of his spousal support obligation that is now before this court for review. I believe this certainly illustrates an abuse of discretion. -2- believe that the record indicates the trial court abused its discretion when making its determination. Although the lower court assumed that appellee's income would greatly decrease following the completion of the South Park Center project because the income he received from the project would be non-recurring, the record demonstrates that this proposition is purely speculative at this time. Appellee's taxable income increased from $63,553.21 in 1994 to $73,507.70 in 1995. Appellee's gross receipts for the first quarter of 1996 indicate an additional increase, resulting in an estimated gross annual income of $80,550. Moreover, the lower court failed to acknowledge that since appellee is self-employed and therefore not on salary, all of his income is non-recurring. The lower court also noted that appellee was now required to pay $25,846 to Social Security. However, appellee was required to make this repayment because he had previously received more money than he was due. Since appellee is merely repaying money he has already received, his obligation to Social Security also fails to indicate a change in circumstances. Furthermore, the annual cost of just over $6,000 for liability insurance that appellee was required to obtain, when coupled with appellee's increased income, is also insufficient to indicate a change in circumstances. -3- Additionally, although appellee reported that his heart attack and subsequent surgery have prevented him from working the same hours that he used to work, the record again fails to demonstrate that appellee has yet suffered a resulting decrease in income. Appellee suffered his heart attack in August 1995. However, his gross receipts for the first quarter of 1996 demonstrate that appellee's gross income continued to increase in spite of his illness. Finally, the record is replete with instances where appellee ignored court orders to pay spousal support. Rather than encouraging compliance with the court's orders, appellee was actually rewarded for his non-compliance when the trial court granted him a reduction in the amount of spousal support he was ordered to pay. Upon a full review of the record, I find that the trial court abused its discretion in reaching its decision. No change in circumstances is evident from the facts in the case sub judice to warrant a modification of alimony. Moreover, the record in this matter demonstrates appellee's complete lack of respect for court .