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Supreme Court of Colorado • 2003

People Ex Rel. J.R.T. v. Martinez

70 P.3d 474

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Takeaway

In short, this case holds that a parent fired for misconduct is not automatically voluntarily underemployed; income may be imputed only after a fact-specific finding that the parent is unreasonably refusing obtainable, higher-paying work and thereby shirking child support.

Background

Jason Martinez's child-support obligations for two children, J.A. and J.R.T., were initially set in 1995 while he earned about $1,866 per month at Denver Mattress Company. After a promotion, he earned approximately $4,510 per month. He was then fired for violating the company's sexual-harassment policy. He next worked as an assistant manager at A World of Tile, earning about $2,648 per month, but was asked to resign after failing to make timely bank deposits despite prior warnings.

After the second termination, Martinez searched briefly for work in Denver but needed immediate income to support his household. He moved to Pueblo, where his wife's family could assist the family and where his children lived, and obtained retail work earning roughly $2,167 per month.

In separate child-support modification proceedings, two trial courts found Martinez voluntarily underemployed under Colorado's child-support statute. Each imputed monthly income of about $4,510—the salary from his highest-paying former job—and calculated support accordingly. The court of appeals reversed, holding that being fired for misconduct alone does not establish voluntary underemployment; the trial courts instead had to consider Martinez's efforts and opportunities to obtain comparable work after his firings. The Supreme Court of Colorado consolidated the cases and affirmed the court of appeals.

Issues

Issue #1

Whether a parent is voluntarily unemployed or underemployed, for child-support income imputation, merely because the parent was fired from higher-paying employment for misconduct.

Holding

No. A firing for misconduct, standing alone, does not make a parent voluntarily unemployed or underemployed under section 14-10-115(7)(b)(I).

Reasoning

Colorado's guidelines ordinarily calculate child support from each parent's actual gross income. The statute permits the court to use potential income only when a parent is "voluntarily unemployed or underemployed." Although "voluntarily" means intentionally and of one's own free will, that phrase is ambiguous when applied to a parent who loses a job through discharge for misconduct: the statute could focus either on fault leading to the firing or on the parent's subsequent employment choices.

The Court read the provision in light of the child-support guidelines as a whole. Those guidelines seek adequate support consistent with parental ability to pay, equitable treatment of similarly situated parents, and efficient resolution of support disputes. A rule automatically imputing the former salary of every parent fired for cause would disregard the parent's present earning capacity and could impose an unattainable support order.

The statute's enumerated exceptions for temporary work, good-faith career choices, and education reflect a broader legislative concern. The General Assembly sought to prevent parents from deliberately reducing available support, while preserving room for good-faith employment decisions that lower income. Legislative history similarly showed a focus on stopping parents from evading support by quitting or taking lower-paying work, not on imposing a categorical penalty for employment misconduct.

Accordingly, income imputation is an exception to the actual-income rule and applies when a parent is shirking a support obligation by unreasonably foregoing higher-paying employment that the parent could obtain. The relevant question is not simply whether the parent could foresee that misconduct might cause termination, but whether the parent presently has a realistic opportunity to earn more and unreasonably declines to pursue it.

Issue #2

What inquiry must a trial court undertake when deciding whether to impute potential income to a parent whose income fell after being fired and taking lower-paying work.

Holding

The trial court must examine all relevant circumstances to determine whether the parent is unreasonably foregoing obtainable higher-paying employment; if not, it must begin the support calculation with the parent's actual gross income.

Reasoning

Whether a parent is voluntarily underemployed requires factual findings and application of the governing legal standard. Appellate courts defer to supported factual findings but review the meaning of the statutory standard de novo. Because the inquiry is fact-dependent, no per se rule based on a firing for cause is permissible.

Relevant circumstances include the firing and the parent's conduct afterward; the time spent seeking comparable employment before accepting lower-paying work; any refusal of a higher-paying job offer; efforts to obtain work in the parent's field of training and experience; available jobs for someone with the parent's education, skills, and background; local wage rates; prior employment history; and child-support payment history. A court may infer shirking from a lack of initiative in finding or retaining work, though the other parent need not prove that a particular available job exists.

The trial courts here began and ended their analysis with Martinez's misconduct and the resulting job losses. They imputed income at the level of his highest-paying former position without considering his limited Denver job search, immediate financial need, move to Pueblo for family support and proximity to his children, or the employment opportunities realistically available to him. That was legal error.

On remand, the trial courts must determine whether Martinez was actually shirking his support obligations by unreasonably foregoing higher-paying work he could obtain. If they find he was, they must assess what he could reasonably earn and contribute. If they do not, the calculation must start from his actual gross income rather than his former Denver Mattress salary.