Bagley v. Bagley

DAVIS, Judge. This is an appeal from an order issued by the Circuit Court for Montgomery County adopting the findings and recommendations of a Domestic Relations Master and denying appellant’s exceptions to the master’s recommendations. Appellant presents the following questions for our review: I: Did the trial court err in reviewing the findings and recommendations of the master?

II

Did the trial court err in making its award of increased child support when it failed to maintain the children at a standard of living comparable to the father’s?

III

Did the trial court err in making its award of increased child support when it failed to consider the fundamental process established by §§ 12-201 through 204 of the Family Law Article of the Maryland Annotated Code (FL)?

IV

Did the trial court err in awarding attorney’s fees in light of the parties’ income levels and the circumstances of this case? FACTS Patricia J. Bagley (appellant) and Warren J. Bagley (appellee) were married on June 28, 1975. The Bagleys are the parents of two sons, Steven (born July 7, 1978) and Christopher (born January 6, 1981). The parties were divorced by ²³ the Circuit Court for Anne Arundel County on January 9, 1990.

The Judgment of Divorce incorporated the parties’ August 23, 1989 Separation and Property Settlement Agreement, which named Mrs. Bagley as sole legal custodian of the children and required Dr. Bagley to pay $2,500 per month in child support. In addition, Dr. Bagley agreed to pay for the children’s medical expenses and $1,000 per month in alimony for a minimum of five years. On October 22, 1991 Mrs. Bagley filed a complaint in the Circuit Court for Montgomery County seeking an increase in child support based upon a substantial increase in Dr. Bagley’s income. On March 20, 1992 a hearing on the matter was held before a Domestic Relations Master.

During the hearing it was established that Dr. Bagley’s annual income was $83,448 in 1989; $235,419 in 1990; and $507,360 in 1991. The master’s report concluded that Dr. Bagley had excess monthly income of just under $10,000 after taxes and expenses. The master concluded that Dr, Bagley could “afford any reasonable child support”; based on the parties’ disparate income levels, however, Mrs. Bagley reasonably could not be expected to contribute to the support of the children. Mrs. Bagley claimed monthly income of $1,000 alimony from Dr. Bagley and $389 disability income from the Veterans Administration.

Mrs. Bagley’s estimated tax burden was $15 per month, leaving income of $1,374 per month. Mrs. Bagley claimed $4,577 in monthly expenses for Steven and Christopher, based on the following itemization: rent ($733); utilities ($150); telephone ($60); food ($666); clothing ($250); medical/dental ($65); 1 transportation ($594); 2 automobile insurance ($46); other household expenses ($30); re ²⁴ creation ($787); 3 incidentals ($301); 4 and periodic payments ($895). 5 The master found, however, that $1,850 of these expenses were “inappropriate expenses to be attributed to the children,” leaving total expenses for Steven and Christopher at $2,722 per month. Inappropriate expenses consisted of legal fees ($500), periodic payments for Mrs. Bagley’s debts ($340), new furniture ($130), gifts ($40), vacation and camp ($300), payments for a new car ($480), and medical and dental expenses ($65). The master’s four-page report did not offer an explanation for her findings regarding the children’s expenses, other than a parenthetical note following the disallowance of the medical and dental expenses, stating that Dr. Bagley is responsible for all medical expenses.

Finally, the master concluded that this case was not appropriate for application of the Maryland Child Support Guidelines because the total income of the parties is far in excess of the maximum considered in the guidelines and because of “other provisions of the parties’ Agreement.” The master made the following recommendations: 1. That the defendant pay to the plaintiff child support in the amount of $2,722.00 per month, commencing and ²⁵ accounting from November 1, 1991, and payable on the 1st day of each month in advance. 2. That all payments of child support due on or after May 1, 1992, be paid through the Child Support Enforcement Division of the Circuit Court for Montgomery County. 3. That the defendant pay to the plaintiff as a contribution toward her attorney’s fees for the issue of child support only the sum of $500.00.

On April 6, 1992 Mrs. Bagley filed a memorandum of exceptions to the master’s findings. Mrs. Bagley’s exceptions, as rephrased by us, were as follows: 1. Legal Fees. The master’s finding that $500 per month in legal fees was not appropriate to attribute to the children was incorrect.

These fees were incurred by Mrs. Bagley while pursuing increased child support and defending against Dr. Bagley’s child custody suit. 6 2. Periodic Payments. The master’s finding that periodic payments to USAA Visa, HFC, John Burke, and Citibank (totaling $340) were Mrs. Bagley’s debts was incorrect because Mrs. Bagley testified that these expenses were attributed to food, clothing, and activities for the children, and money borrowed for attorney’s fees. At oral argument before the chancellor, Mrs. Bagley also associated these expenses with moving from home to home in an attempt to find suitable housing. 3.

Furniture. The master incorrectly denied expenses for replacement furniture even though Mrs. Bagley testified to the inadequacy of the children’s current furniture. 4. Gifts. The master incorrectly reduced gift expenses from $80 to $40 per month.

These expenses, according to Mrs. Bagley, were fair, reasonable, and uncontradicted during the master’s hearing. ²⁶ 5. Vacation/Camp. The master incorrectly denied expenses for a vacation to visit family members once a year and attend two summer camps. Mrs. Bagley underscores that Dr. Bagley acknowledged during the hearing the importance of the Odyssey of the Mind Camp, whose mission was never clearly put on the record. 6.

New Vehicle. The master incorrectly denied payment for a minivan that Mrs. Bagley claimed was necessary to transport her sons, their equipment, and friends. Mrs. Bagley admits that her 1990 Corsica is suitable for herself, but she argues that a minivan would improve the lives of her sons. 7. Medical/Dental Expenses.

Mrs. Bagley argues that this expense was limited to over-the-counter items not contemplated as medical expenses paid by Dr. Bagley. 8. Attorney’s Fees Awarded. The award of $500 in attorney’s fees is inadequate based on Mrs. Bagley’s testimony that her costs for the child support hearing would total $4,000; 7 Mrs. Bagley’s brief to this Court claims attorney’s fees of $5,013.50. Moreover, Mrs. Bagley alleges that Dr. Bagley’s attorney caused unreasonable delays that added to her legal expenses. 9.

Improper Influence. The master was improperly influenced by her irritation with Mrs. Bagley’s counsel. 10. Child Support Guidelines. The increase of $222 per month in child support payments was inadequate in light of Dr. Bagley’s increased income level and contradicted the statutory guidelines codified in FL §§ 12-201 through 204.

Dr. Bagley filed an Answer refuting each of Mrs. Bagley’s exceptions. Dr. Bagley asserted that exception 1 — legal fees were expenses attributable to Mrs. Bagley and may be awarded by the court at a future time but should not be the basis for an increase in child support at the present time. No specific citation was made to the record. ²⁷ In response to exceptions 2 — periodic payments, 3 — -furni ture, 4 — gifts, 5 — vacation/camp, and 6 — new vehicle, Dr. Bagley asserted that these expenses “relate to debts, consumer purchases, or other chattel that this Plaintiff/Counter-Defendant has purchased for herself and seeks now to use as the basis to claim a need for increased child support.” No citation was made to the record. In response to exception 7 — medical/dental expenses, Dr. Bagley referred to his past record of paying for the children’s health care needs, as well as his intention to continue doing so.

Dr. Bagley answered exception 8 — attorney’s fees awarded by arguing that a request for $4,000 for counsel fees for a simple child support hearing was patently unreasonable and that the record did not support Mrs. Bagley’s claim that delays caused by Dr. Bagley’s attorney resulted in increased fees. In response to exception 9 — improper influence, Dr. Bagley claimed that the record spoke for itself but did not cite any specific portion. Dr. Bagley responded to exception 10 — child support guidelines by arguing that the findings of the master properly accounted for the total expenses for each party. Dr. Bagley argued that, although the comparative lifestyles of the parties have changed, all parties were doing “appreciably better” than at the time of the divorce decree.

On June 25,1992, the trial judge issued a Memorandum and Order adopting the master’s findings and recommendations. The Memorandum read in relevant parts: The Master served her Findings of Fact and Recommendations on March 30, 1992 and recommended an increase in child support payments to $2,722 per month and for the Defendant to pay $500 toward the Plaintiffs attorney’s fees. The Plaintiff filed Exceptions on April 6, 1992, stating that the Master should have proposed child support in the amount of $4,577 per month based on her monthly expenses. The Master determined that $1,855 of the Plaintiffs monthly expenses were inappropriate to be assessed to the children and therefore proposed $2,722 per month in child ²⁸ support and $500.00 in attorney’s fees for the issue of child support.

Pursuant to Maryland Annotated Code, Family Law § 12-204(d), the Court may use its discretion in setting the amount of child support when the combined adjusted actual income of the parties exceeds the child support guidelines. Based on the transcript of the proceedings before the Master, the Plaintiffs Exceptions, the Defendant’s Answer to the Exceptions and the parties [’] Agreement of August 23, 1989, this Court finds that the Master was not shown to be clearly erroneous in her findings or misapplied the law to her findings. In an exercise of its independent judgment, this Court hereby adopts the Findings and Recommendations of the Master as its own. LEGAL ANALYSIS Mrs. Bagley claims that the trial court erred procedurally and substantively when it adopted the findings and recommendations of the master.

Procedurally, Mrs. Bagley claims the court did not apply the proper standard when reviewing the master’s findings in light of her exceptions. Substantively, she contends that the court reached an improper result with respect to the amount of child support and the amount of attorney’s fees, even if the proper standard of review was followed. We first address Mrs. Bagley’s procedural claims. I Mrs. Bagley contends that the Court of Appeals created a mandate in Domingues v. Johnson, 323 Md. 486 , 593 A.2d 1133 (1991), requiring the trial court to consider each exception presented by the plaintiff for consideration and thereafter to make a specific finding regarding each exception.

The chancellor erred in this case, according to Mrs. Bagley, because he adopted the master’s findings and recommendations without stating in an oral or written opinion how he resolved her exceptions. The chancellor’s express statement that “independent judgment was exercised” was insufficient to meet ²⁹ the Domingues standard, she argues. Mrs. Bagley draws no distinction between exceptions alleging erroneous fact-finding and allegedly improper conclusions of law made by the chancellor. Dr. Bagley, on the other hand, argues that Domingues mandates only that the trial court independently evaluate the record and not merely “automatically accept” the master’s findings.

Dr. Bagley appears to deny that Domingues would ever require the chancellor to make specific findings of fact on the record. Neither party correctly understands Domingues . The dispute in Domingues arose after mother filed a petition for modification of an existing divorce decree to modify the father’s visitation schedule to accommodate her projected relocation and to increase the father’s obligation for child support. The father answered and filed a motion seeking sole custody of the children.

An extensive hearing was held before a Domestic Relations Master. After a five-day hearing, the master filed an 84-page report finding a substantial change in circumstances since the divorce decree and recommending that primary custody be given to father. Mother filed exceptions with the circuit court, contending that “many of the facts found by the master have no foundation in the record.” Id. at 496 , 593 A.2d 1133 . The chancellor heard arguments of counsel regarding the exceptions and subsequently entered an order adopting the master’s recommendations.

This Court heard mother’s appeal and reversed the chancellor, concluding that he erred when he considered the best interests of the child instead of determining whether there was sufficient evidence of a change in circumstances affecting the welfare of the child. See Johnson v. Domingues, 82 Md.App. 128, 134 , 570 A.2d 369 (1990), rev’d, 323 Md. 486, 490 , 593 A.2d 1133 (1991). The Court of Appeals ordered a stay of that order and granted father’s petition for certiorari. The Court of Appeals found that the chancellor did not err when he considered the best interests of the child, but that the chancellor did err when he incorrectly “accepted the recommendations of the master upon a finding that those recommendations were not clearly erroneous, instead of subjecting the master’s fact-finding to a ³⁰ clearly erroneous test and then exercising his independent judgment concerning the proper conclusion to be reached upon those facts.” Domingues, 323 Md. at 490 , 593 A.2d 1133 .

The Court delineated the proper interaction between a master and a chancellor in cases where a party has filed exceptions, contending that the master’s fact-finding is not supported by the record. As a general rule, a master’s findings of fact are given deference under the clearly erroneous rule. Id. at 496 , 593 A.2d 1133 . Where a party argues that facts found by the master have no foundation in the record, however, deference under the clearly erroneous rule recedes.

Id. The chancellor must carefully consider the allegations and decide each such question. “The chancellor should, in an oral or written opinion, state how he resolved those challenges. Having determined which facts are properly before him, and utilizing accepted principles of law, the chancellor must exercise independent judgment to determine the proper result.” Id. This rule was clarified in the subsequent case of Kirchner v. Caughey, 326 Md. 567 , 606 A.2d 257 (1992).

The Kirchner Court stated that “[w]e now make clear that the written or oral opinion of the chancellor should address as well the issues relating to the conclusions to be drawn from the facts found.” Id. at 572 , 606 A.2d 257 . The Court reasoned that Maryland Rule 2-522(a), 8 which the Court found “applies to a final judgment in every non-jury action ...,” requires no less than “consideration of the relevant issues and the reasoning supporting the chancellor’s independent decisions on those issues....” Id. at 573 , 606 A.2d 257 . The Court was cognizant of the “substantial” burden carried by the chancellor. In this vein, the Court stated: ³¹ The necessity that the chancellor rule on challenges to findings of fact which may involve testimony spread throughout hundreds of pages of transcript, the difficulty of making a decision as to the best interest of a child without personally observing the witnesses, and the critical nature of the decision that must be made, as well as the wide discretion that is necessarily afforded that decision by the appellate courts, all speak to the care and attention that must be given the case by a chancellor.

Domingues, 323 Md. at 497 , 593 A.2d 1133 . The chancellor’s burden is lessened to the extent that the opposing party provides an adequate reply to the moving party’s exceptions. The Domingues Court noted that the chancellor should not be required to conduct an unassisted search of the entire record for testimony that would support each challenged finding. To the extent that the master’s report does not provide reference to the underlying testimony upon which a finding is based, the party responding to an exception of this type should specify those portions of the record upon which he or she relies to demonstrate an adequate foundation for that finding.

Id. at 496, 593 A.2d 1133 . Dr. Bagley’s Answer to Mrs. Bagley’s exceptions does not adequately meet this standard because it makes no more than a few oblique references to the record for support. While this could not provide a basis for excusing a chancellor’s improper review of a master’s challenged fact-finding, the inadequacy of Dr. Bagley’s Answer certainly made proper disposition of this case more difficult for all parties involved. An important caveat to the Domingues-Kirchner standard, overlooked by Mrs. Bagley, is that it only applies to exceptions that allege that a master’s fact-finding is unsupported by the record.

Kirchner, 326 Md. at 572 , 606 A.2d 257 ; Domingues, 323 Md. at 496, 593 A.2d 1133 ; Noffsinger v. Noffsinger, 95 Md.App. 265 , 274 n. 1, 274-75, 620 A.2d 415 (1993). Appellate discipline mandates that, absent a clear abuse of discretion, a chancellor’s decision that is grounded in ³² law and based upon facts that are not clearly erroneous will not be disturbed. Domingues, 323 Md. at 492 n. 2, 593 A.2d 1133 , citing Ross v. Hoffman, 280 Md. 172, 186 , 372 A.2d 582 (1977); Davis v. Davis, 280 Md. 119, 124-25 , 372 A.2d 231 , cert. denied, 434 U.S. 939 , 98 S.Ct. 430 , 54 L.Ed.2d 299 (1977). Where the findings are supported by evidence and therefore not clearly erroneous, the trial judge is left with discretion to determine the proper disposition of the case.

Noffsinger, 95 Md.App. at 275 , 620 A.2d 415 ; Wenger v. Wenger, 42 Md.App. 596, 602 , 402 A.2d 94 (1979). In Wenger , we noted that a “given set of facts does not lead mechanically to a single, automatic disposition but may support a range of discretionary dispositions.” Id. at 602 , 402 A.2d 94 . In the case sub judice, the chancellor’s order suggests that he did not examine Mrs. Bagley’s exceptions to determine which, if any, alleged clearly erroneous fact-finding by the master. A review of Mrs. Bagley’s exceptions reveals that only exceptions numbered 1 — legal fees, 2 — periodic payments, furniture, 4 — gifts, 5 — vacation/camp, and 6 — new vehicle allege erroneous fact-finding by the master.

The chancellor was obligated under the Domingues-Kirchner standard to state, in an oral or written opinion, how he resolved the factual challenges reflecting “consideration of the relevant issues and the reasoning supporting the chancellor’s independent decisions on those issues____” Kirchner, 326 Md. at 573 , 606 A.2d 257 . In the case sub judice, exceptions 1, 2, 3, 4, 5, and 6 all arise from the chancellor’s conclusion that these expenses could not be factually assessed to the children. This is the very same conclusion Mrs. Bagley challenged when it was made by the master. The chancellor did not make any record of how he resolved Mrs. Bagley’s challenge that the record supports the opposite conclusion, i.e., that these expenses are assessable to the children.

Therefore, this case must be remanded to