BACKGROUND
The parties in this case were married for nearly 30 years. The wife sought an Order for interim spousal support in the amount of $85,551 per month.
The parties had a traditional marriage where the wife had given up her career after the birth of the party’s children. The issue here was not whether the wife was entitled to spousal support, as she clearly was, but the quantum she was owed. In order to determine this, the judge needed to make a finding of the party’s incomes.
The wife was named owner of a corporation that the husband ran for liability purposes. The husband’s income from this corporation fluctuated year to year. The wife did not earn employment income. Each of the parties filed expert reports which valuated the husband’s income for support purposes. The expert report of the wife valued the 4-year average of the husband’s income to be $2,264,000, and the expert report of the husband valued it at $1,801,000.
ANALYSIS
The husband argued that given the volatility of his income, the court should take a cautious approach in determining his income for support purposes. His business is transaction-based and only earns income when he is successful. For this reason, he was required to keep a significant amount of working capital in his business to broker deals, and therefore it was his position that the retained earnings of the company should not be used for support purposes.
The court agreed that a cautious approach to the determination of the husband’s income was necessary as the nature of his business required keeping significant capital, but ultimately noted the husband has consistently made substantial income. It is for this reason; the court accepted the conclusions of the expert report of the husband and determined the husband’s income to be $1.8 million for the purposes of interim support.
Though the wife was technically the owner of various corporations run by the husband, she did not actually earn employment income and therefore for the purposes of the motion the court found her income to be nil.
With the husband’s income of $1.8 million and wife’s income of nil, the SSAG’s determined a mid-range spousal support payment of $65,625 monthly. The court’s primary considerations in determining this were the husband’s ability to pay and the wife’s need. The husband clearly has the means to pay based on his income, and the wife’s proposed budget aligned perfectly with the amount of after-tax spousal support she would receive at the mid-range support amount. Therefore, this court determined interim spousal support at the amount of $65,625 based on the mid-range SSAG formula was appropriate and so ordered.
It is important to note that this case is an outlier in that courts very rarely apply mid-range SSAGs to income of this high of an amount.
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