LANG v. LANG

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Docket Number

No. 70-955.

Attorney(S)

Anthony V. Pace, Jr., Fort Lauderdale, for appellant. Edward J. Marko, of Shaw, Marko, Stephany Lyons, Fort Lauderdale, for appellee.

Acts

Internal Revenue Code — Income Taxes — Normal Taxes And Surtaxes — Computation Of Taxable Income — Deductions For Personal Exemptions — Allowance Of Deductions For Personal Exemptions

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Smart Summary

Factual and Procedural Background

This appeal arises from a modification of a final divorce decree involving Donald Headdon Lang (appellant) and Barbara Roll Lang (appellee). The parties, previously residents of New York with their two minor children, separated in 1961 and entered into a separation agreement addressing custody and support. A supplementary agreement in 1962 reduced appellant's payments. In 1963, the wife filed for divorce in Florida, where the court assumed jurisdiction and entered a final divorce decree incorporating the separation agreements and specifying support payments.

In 1970, the appellee petitioned for modification, alleging increased needs of the children. The trial court increased child support payments, allowed each party to claim one child as a tax exemption, and awarded attorney's fees to the appellee. The appellant appealed, contesting the court's authority to modify the separation agreement and the failure to apply New York law.

Legal Issues Presented

Whether the trial court had authority to modify the child support provisions of a separation agreement incorporated into a final divorce decree.
Whether the trial court erred by failing to construe the separation agreements according to New York law.
Whether the trial court properly granted the appellee the right to claim a child as a tax exemption contrary to the Internal Revenue Code.
Whether the trial court properly awarded attorney's fees to the appellee in connection with the appellant's motion to rehear the modification order.
Whether the trial court abused its discretion in denying appellant's petition for rehearing of the modification order.

Arguments of the Parties

Appellant's Arguments

The trial court lacked authority to modify the amounts fixed in the separation agreement since the parties’ rights were settled by that agreement.
The separation agreements stipulated that modifications required written consent by both parties and were governed by New York law, which the trial court failed to apply.

Appellee's Arguments

The court had jurisdiction and authority to modify child support based on changed circumstances and the welfare of the children.
The welfare of minor children supersedes contractual provisions, including choice-of-law and modification clauses.
The award of attorney's fees was justified in connection with the modification proceeding.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
McKenna v. McKenna, 220 So.2d 433 (Fla. App. 1969)	Presumption of correctness on appeal; burden on party challenging increased child support to show abuse of discretion.	Established standard for reviewing modification of child support orders.
State ex rel. Galen v. Kuhl, 103 So.2d 225 (Fla. App. 1958)	The welfare of minor children is the paramount concern of the state of residence or domicile.	Supported the court’s authority to modify support orders to protect children's welfare.
Ohmes v. Ohmes, 200 So.2d 849 (Fla. App. 1967)	Statute permitting modification of support agreements becomes part of all such contracts.	Confirmed that statutory modification powers apply despite contractual terms to the contrary.
Sedell v. Sedell, 100 So.2d 639 (Fla. App. 1958)	Provisions related to child support and custody are always subject to court review for the best interests of children.	Supported overriding contractual provisions to safeguard child welfare.
Lee v. Lee, 26 So.2d 177 (Fla. 1946)	A father cannot contractually avoid his obligation to support minor children.	Emphasized paramount importance of child welfare over contract terms.
McMains v. McMains, 15 N.Y.2d 283 (N.Y. Ct. App. 1965)	Even with a nonmerger provision, courts may modify divorce decrees and separation agreements when circumstances justify.	Supported modification authority under New York law, consistent with Florida law.
Kern v. Kern, 319 N.Y.S.2d 178 (N.Y. Fam. Ct. 1970)	Children's right to support is not affected by parental agreements; best interests of the child govern.	Reinforced principle that child support obligations override parental contracts.
Posner v. Posner, 233 So.2d 381 (Fla. 1970)	Supports court discretion in modifying support orders.	Used as a comparative authority confirming discretion to modify support.
Brown v. C.I.R., 48 T.C. 42 (1967)	Determination of tax exemptions depends on actual support expenditures, not agreements.	Supported court’s refusal to alter tax exemption rights by judicial order.
Seraydar v. C.I.R., 50 T.C. 756 (1968)	Tax exemption rights depend on proof of support, not contractual provisions.	Confirmed limits on court’s authority to assign tax exemptions.
Gullette v. Ochoa, 104 So.2d 799 (Fla. App. 1958)	Attorney's fees cannot be awarded unless authorized by statute or agreement.	Supported reversal of attorney's fees award for appellee.
Graves v. Graves, 115 So.2d 451 (Fla. App. 1959)	Modification petitions are not actions for enforcement of judgments; no fee award authorized.	Clarified limits on attorney's fees in modification proceedings.
Luedke v. Behringer, 143 So.2d 218 (Fla. App. 1962)	Same as Graves; attorney's fees not allowed absent statutory authority.	Reinforced prior precedent on attorney's fees.
Terry v. Terry, 126 So.2d 890 (Fla. App. 1961)	Attorney's fees limited by statute or agreement.	Supported court's limitation on fee awards.
Libberton v. Libberton, 240 So.2d 336 (Fla. App. 1970)	Attorney's fees not authorized in modification actions absent statute/agreement.	Used to support reversal of fee award.
Thompson v. Thompson, 223 So.2d 95 (Fla. App. 1969)	Attorney's fees limited to enforcement actions under statute.	Supported court’s ruling on fees.
Cocalis v. Cocalis, 103 So.2d 230 (Fla. App. 1958)	A timely rehearing is part of the original proceeding, not a new action.	Supported denial of fees for defense of rehearing motion.

Court's Reasoning and Analysis

The court began with the presumption that the trial court's decree is correct and that a party challenging increased child support must show abuse of discretion. It emphasized the paramount importance of the welfare of minor children as the guiding principle overriding contractual provisions, including choice-of-law and modification clauses in separation agreements. The court cited Florida statutes (F.S. Section 61.14) empowering courts to modify support agreements upon changed circumstances and held that such statutes effectively become part of all agreements.

The court rejected appellant's argument that New York law should govern, finding that even under New York law, courts retain authority to modify separation agreements and divorce decrees to meet changed circumstances and protect child welfare.

Regarding the tax exemption issue, the court held that the trial court exceeded its authority by granting a right to claim a child as a tax exemption because such determinations depend on actual support expenditures under the Internal Revenue Code, not judicial modification of separation agreements.

On attorney's fees, the court found no statutory or contractual basis to award fees for the modification petition or the appellant's rehearing motion. It explained that modification proceedings are not "actions for enforcement" under the relevant statute (F.S. Section 61.15), and thus attorney's fees are not authorized.

Finally, the court found no abuse of discretion in denying appellant’s rehearing petition on the modification order.

Holding and Implications

The court affirmed in part and reversed in part the trial court's order. Specifically, the court affirmed the increase in child support payments and the denial of rehearing, while reversing the trial court's order granting appellee the right to claim a child as a tax exemption and awarding attorney's fees to the appellee.

The case was remanded with instructions for the trial court to modify its orders consistent with this opinion. The decision clarifies that while courts have broad authority to modify child support to protect children's welfare, they cannot alter tax exemption rights governed by federal tax law nor award attorney's fees absent statutory or contractual authorization. No new precedent was set beyond reaffirming established principles regarding child welfare, modification authority, and limits on judicial power over tax matters and attorney's fees.

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DONALD HEADDON LANG, APPELLANT, v. BARBARA ROLL LANG, A/K/A BARBARA ROLL STROUD, APPELLEE.

MAGER, Judge.

This is an appeal from a modification of a final decree for divorce. On the basis of appellee-wife's petition for modification the court below increased child support payment; gave each party the right to declare one of their two children as a tax exemption; and awarded attorney's fees to appellee.

Prior to their divorce in Florida, the parties and their two minor children resided in the State of New York. In 1961 the parties separated and entered into a separation agreement fixing their respective rights which included a provision for child custody and support. In 1962 the parties entered into a supplementary agreement which reduced the appellant's payments for the maintenance of the wife and support of the children. In 1963 the wife filed for divorce in Florida. After finding that the court had jurisdiction over the parties the court, on May 14, 1963, entered a final decree of divorce for the appellee. The final decree directed that the parties carry out the provisions of the aforementioned separation agreements; the order set forth the specific amounts that the appellant should pay to the appellee which amounts were those previously contained in the supplementary separation agreement.

On September 21, 1970, based upon allegations of the needs of the minor children the court granted appellee's petition for modification increasing the support of each minor child from $100.00 per month to $150.00 per month.

The order of the court, therefore, not only modified the divorce decree entered in 1963 but had the effect of modifying the provisions of the separation agreement entered into prior to the divorce.

It is the appellant's contention that the trial court was without authority to enter an order modifying the amounts contained in the separation agreement inasmuch as the rights of the parties were fixed thereby; appellant further contends that the trial court erred in failing to construe the separation agreements in accordance with the laws of the State of New York. The separation agreements contained provisions to the effect that the rights of the parties would be governed by the laws of the State of New York and that the agreements could not be modified "other than in writing signed by both parties".

No citation is needed for the principle that the decree of the chancellor comes to this court on appeal with a presumption of correctness. A party who challenges the correctness of increased allowance of child support has the burden of demonstrating on record an abuse of discretion. McKenna v. McKenna, Fla. App. 1969, 220 So.2d 433. It is a fundamental proposition that the welfare of minor children is the concern of the state in which the child may reside or be domiciled. State ex rel. Galen v. Kuhl, Fla. App. 1958, 103 So.2d 225. In furtherance of this proposition the legislature enacted F.S. Section 61.14, F.S.A., which permits either party to apply to the circuit court of the circuit in which the parties resided at the date of application for the modification of any agreement for the payment of support, maintenance or alimony where "the circumstances of the parties or the financial ability of the husband has changed since the execution of such agreement * * *". It has been held that this statute becomes a part of all contracts or agreements between the parties to the same extent as if written therein in haec verba. Ohmes v. Ohmes, Fla.App. 1967, 200 So.2d 849.

The fact that the settlement agreements in question contained a provision requiring written consent of the parties to modify and were executed in the State of New York does not and cannot divest a court of the authority to modify such agreements where the welfare of minor children is concerned. In Sedell v. Sedell, Fla.App. 1958, 100 So.2d 639, the court specifically held that provisions of a separation agreement or final decree relating to the support, care and custody of children are always subject to review and approval by the court, the guiding star being the best interests and welfare of the children. See also Lee v. Lee, 1946, 157 Fla. 439, 26 So.2d 177; McKenna v. McKenna, supra; Rieder v. Rieder, Fla.App. 1963, 157 So.2d 93; Lopez v. Avery, Fla. 1953, 66 So.2d 689; Stanley v. Stanley, 1947, 158 Fla. 402, 28 So.2d 694; and Margolis v. Margolis, Fla. App. 1962, 141 So.2d 1.

In Lee v. Lee, supra, the Supreme Court of Florida, in permitting a modification of a separation agreement, clearly stated that "we know of no rule of law by which a father may by contract obviate or impair his obligation to support his minor children". The welfare of minor children is of such paramount importance as to constitute an integral part of any separation agreement; every separation agreement must be construed in light of this basic principle. Not only is this principle implicit in the separation agreement but additionally it transcends any contractural provision in derogation thereof. For this principle to be applicable it makes little difference whether such an agreement was executed in this state or any other state. Where the court has jurisdiction over the parties, as in the case sub judice, interpretation or modification of a separation agreement affecting the welfare of children is not only permissible but obligatory where the circumstances so indicate.

If we were to accept the appellant's contention that the law of New York should govern we would still reach the same conclusion consistent with New York law. In McMains v. McMains, Ct. of Appeals N.Y. 1965, 15 N.Y.2d 283, 258 N.Y.S.2d 93, 206 N.E.2d 185, it was held that even where a separation agreement contains a nonmerger provision, i.e., the agreement being deemed to be independent of the divorce decree, the court is not prevented from later modifying the divorce decree (and separation agreement) where the circumstances justify such modification. The decision in McMains is particularly noteworthy in that the court's modification dealt solely with an increase in alimony for the wife and was not even concerned with the question of the welfare of minor children. In the very recent case of Kern v. Kern, 1970, 65 Misc.2d 765, 319 N.Y.S.2d 178, the Family Court of the City of New York clearly stated that the basic right of the minor child to be supported by its parents is not affected by an agreement between the parties with respect to such obligation; "children are not chattels whose rights can be bargained away by parents"; such agreements will be evaluated with the best interests of the child as its criteria.

Therefore, even applying New York law, it is our opinion that it was within the discretion of the trial court to enter an order of modification increasing child support payments. Cf. Posner v. Posner, Fla. 1970, 233 So.2d 381.

We are of the view, however, that the trial court exceeded its authority in granting the appellee the right to declare one of her two children as a tax exemption for the taxable year 1970 and each taxable year thereafter. Under the terms of the separation agreements heretofore mentioned, which the trial court in its final decree of divorce directed the parties to carry out (except as modified by the order appealed herein), the appellant was entitled to claim the children as dependents on his income tax return unless the appellee could demonstrate that she furnished more than one-half of the support of each child. At first blush it may seem that all the trial court undertook to do was merely to modify one other aspect of the separation agreement relating to support of minor children. However, a closer examination of such modification reveals that the trial court has in effect modified the provisions of the Internal Revenue Code pertaining to allowable deductions for dependents. The question of whether a party is entitled to deductions for personal exemptions for minor children is dependent upon proof that the taxpayer's expenditures in support of each child exceeded one-half of the total support provided for each child in each taxable year. (See 26 U.S.C.A. §§ 151-153; see also Section 152(c) relating to multiple support agreements). We are not aware of any authorization for a state court to alter the provisions of the Internal Revenue Code. The determination of exemption depends upon actual support expenditures rather than the provisions of a separation agreement or judicial modification thereof. Brown v. C.I.R., 1967, 48 T.C. 42; Seraydar v. C.I.R., 1968, 50 T.C. 756. (See also cases annotated under 26 U.S.C.A. §§ 151-153, supra.)

Accordingly, whether either appellee or appellant "shall have the right to declare one child as a tax exemption" is to be determined by the applicable provisions of the Internal Revenue Code and not by the terms of the order for modification.

We are also of the opinion that the trial court erred in awarding attorney's fees to appellee in connection with appellant's motion to rehear the order of modification granted in favor of the appellee. The law is well established in Florida that costs, expenses and attorney's fees cannot be awarded by a court in a suit unless such award is authorized by statute or by agreement of the parties. Gullette v. Ochoa, Fla.App. 1958, 104 So.2d 799. F.S. Section 61.15, F.S.A., authorizes the award of attorney's fees "when an action is brought for the purpose of enforcing a judgment or order for the payment of alimony or support for children". Appellee's petition for modification cannot be construed as constituting "an action * * * for the purpose of enforcing a judgment or order" within the meaning of Section 61.15; nor can appellant's motion to rehear the court's order granting modification transform appellee's original action into one for which an attorney's fee is allowable under Section 61.15. Graves v. Graves, Fla.App. 1959, 115 So.2d 451; Luedke v. Behringer, Fla.App. 1962, 143 So.2d 218; Terry v. Terry, Fla.App. 1961, 126 So.2d 890; Libberton v. Libberton, Fla.App. 1970, 240 So.2d 336; Thompson v. Thompson, Fla.App. 1969, 223 So.2d 95. A proceeding on rehearing, when timely filed, is a part and a continuation of the original proceeding. Cocalis v. Cocalis, Fla.App. 1958, 103 So.2d 230. Therefore if the wife initiates an action for the modification of a final divorce decree for which she is not entitled to attorney's fees, then a fortiori she would not be entitled to attorney's fees in defense of the husband's timely rehearing of an order granting such modification.

We further find no abuse of discretion by the trial court in denying appellant's petition for rehearing of the order of modification.

To the extent that the trial court's order increases child support payments and denies rehearing, it is affirmed. To the extent that the trial court's order determines the status of minor children for income tax exemption purposes and awards attorney's fees to appellee such order is quashed. The trial court is directed on remand to modify its orders consistent with this opinion.

Affirmed, in part; reversed, in part.

REED, C.J., and OWEN, J., concur.