Dad Who Didn’t Disclose Must Pay Retroactive Support

By Attorney Gregg Herman
February 26, 2009

From the first two sentences of a recent Dist. II Wisconsin Court of Appeals decision, it was evident that it was not going to be good news for Jeffery B. Stevenson, who “played a game of ‘cat and mouse’ with the court for nine years. He has finally been caught.” See Stevenson v. Stevenson, No. 2007AP2143 (Wis. Ct. App. Feb. 4, 2009) (recommended for publication).

The decision affirmed the order rendered by Winnebago County Circuit Court Judge Barbara H. Key. This article will summarize the holding; next week’s column will critique it.

Trust Dollars Aren’t Disclosed

Jeffrey and Tina Stevenson married in 1992 and had one child. A petition for divorce was filed in 1996. Both parties were pro se. Before their divorce, they each filed financial disclosure statements with their respective incomes, but Jeffrey did not report any trust interests. In the marital settlement agreement, he agreed to pay $512 per month for child support, and, based on this information, a judgment of divorce was granted in 1997.

In 2003, Tina filed a request for production of documents based on her contention that a substantial change in circumstances existed warranting an increase in child support. After repeated requests that Jeffrey comply, Tina filed a motion to compel discovery and increase child support in 2004. In February 2007, by stipulation of the parties, the court approved an order increasing child support.

In May 2006, Tina filed a motion to reopen the judgment of divorce, claiming that Jeffrey deliberately failed to disclose his income and assets during the divorce.

The trial court granted Tina’s motion to reopen the judgment of divorce to adjust the child support determination and ordered Jeffrey to pay retroactive child support from 1997 through 2003, including 12 percent interest commencing from the filing date of Tina’s motion to reopen and continuing until the judgment was satisfied in full. Jeffrey was also ordered to pay Tina’s attorney fees of approximately $15,000. Jeffrey appealed.

‘Obstructive Behavior’ Influences the Outcome

In a decision by Presiding Judge Daniel P. Anderson, the state Court of Appeals affirmed. Anderson wrote that, had Jeffrey fully disclosed his assets at the time of the divorce, the trial court would have set child support at a drastically different level. The appellate court held that, under Wisconsin Admin. Code § DWD 40.02(13)(a) and Grohmann v. Grohmann, 189 Wis. 2d 532, 525 N.W.2d 261 (1995), the trust income was available for child support. Therefore, Jeffery did not make full disclosure as required by Wis. Stat. §767.27(1)(1995-96).

The appellate court also affirmed the ruling that Tina was entitled to back support of all years after the divorce, emphasizing Jeffrey’s “significantly obstructive behavior”. The appellate court agreed with that characterization, finding that the failure to disclose did not come to light until after Tina filed her motion to reopen in 2006. Since the trial court would have set child support at a “drastically higher level” had Jeffrey fully disclosed his assets at the time of the divorce, the Court of Appeals affirmed the ruling of the trial court, granting retroactive child support all the way back to the date of divorce.

Chief Judge Richard S. Brown concurred in the result, noting that Jeffrey waived the issue of whether the court order violated Wisconsin law prohibiting retroactive increases in child support. Brown wrote separately to note that even if Jeffrey had raised that issue, he would not have succeeded due to the fraud on the court.

This article originally appeared in the Wisconsin Law Journal.

Attorney Gregg Herman is a founding partner of Loeb & Herman, LLC in Milwaukee, WI. He practices family law exclusively, and can be reached via e-mail or by calling (414) 272-5632.