In re the Parental Responsibilities Concerning N.J.C., a Child, and Concerning N.E., Appellant, and V.J.C., Appellee.
Douglas County District Court No. 12JV77 Honorable Natalie T.
Fairfield and Woods, P.C., Lee Katherine Goldstein, Michael
R. McCurdy, Denver, Colorado, for Appellant
J. Keil, Jr., Denver, Colorado, for Appellee
1 As a matter of first impression, N.E. (mother) urges us to
conclude that deferred compensation in a nonqualified
is income for child support purposes if it is being earned
during a period when a parent is obligated to pay child
support. We disagree with her arguments, and therefore affirm
the juvenile court's order adopting the magistrate's
order modifying mother's child support award from V.J.C.
(father). We also affirm the juvenile court's order
denying mother's request to reallocate costs paid for
parental responsibilities evaluations (PRE).
2 However, we reverse the portion of the juvenile court's
order denying mother's request for attorney fees, and we
remand the case to the juvenile court for it to determine the
amount. We further remand for the juvenile court to consider
mother's request for appellate attorney fees under
section 19-4-117, C.R.S. 2019.
Appellate Standard of Review
3 This case arises out of the Uniform Parentage Act (UPA),
sections 19-4-101 to -130, C.R.S. 2019. Magistrates may
preside over UPA actions, but parties have the right to seek
a judge's review of the magistrate's findings and
rulings. § 19-1-108(1), (4)(b), (5.5), C.R.S. 2019.
4 "We defer to the magistrate's and district
courts' findings of fact if they are supported by the
evidence and we review conclusions of law de novo."
In re B.J., 242 P.3d 1128, 1132 (Colo.
Father's Deferred Compensation Plan
5 Mother and father are the unmarried parents of one child,
N.J.C. In 2013, and as part of the initial paternity
proceeding in this case, father's child support
calculation was based on the salary he earned working as a
cardiologist for his own medical practice.
6 In 2016, father closed his practice and accepted a job with
Healthy Connections, Inc. (HCI), a health care center
providing medical, dental, and outreach services to
impoverished communities. Believing that father's income
had gone up at his new job, mother moved to increase child
support. Father, however, responded that his income had
7 Evidence presented at a hearing on mother's motion
showed that father's compensation package with HCI
consisted of a $150, 000 annual salary and $200, 000 of
yearly deferred compensation in a nonqualified plan. Father,
who was then fifty-two years old, testified that he would
only receive the deferred compensation after he retired from
HCI at age sixty-five. HCI's CEO, his brother, agreed
that father "does not receive - physically receive $200,
000 above his salary," and he described the deferred
compensation as "an obligation at a future date and time
for [father's] benefit providing that he meets the
criteria after his retirement."
8 The CEO explained that the deferred compensation plan
allowed HCI to attract and retain qualified medical doctors,
like father, that it could not otherwise afford. He testified
that half of the ten to thirteen medical doctors on HCI's
staff were employed under the deferred compensation plan.
According to the CEO, while each plan was tailored to the
employee, they all had the same payout structure - the
employee had to retire from HCI at a certain age before he or
she would receive any deferred funds, which would then be
paid over ten years. As of the hearing date, the CEO said
that the deferred compensation plan was unfunded; in fact,
the CEO stated there was not even an account established with
which to pay deferred compensation.
9 Regarding father's specific deferred compensation plan,
the CEO submitted a letter to father's counsel (admitted
at the hearing as Exhibit A) detailing that father had no
control over the funds or the plan; the deferred amounts
belonged to HCI and were not protected in case of insolvency
or creditor claims; the deferred amounts were subject to
forfeiture if father was fired, quit, or retired before age
sixty-five; father would not be fully vested until he worked
at HCI for five years; and the funds were not taxable until
received by the employee.
10 Arguing that it was significant that father earned the
money, even if he did not actually receive it, mother asked
the magistrate to include the deferred compensation as income
to father. The magistrate declined to do so, based on the
restrictive provisions of father's plan described above.
The magistrate then modified father's child support
obligation, including in father's income only his salary
and nominal dividend and interest income.
11 The juvenile court judge adopted the magistrate's
decision not to include the deferred compensation, pointing
out the magistrate's reasoning that father could not
contribute to the plan, had no control over the funds, and
had no guarantee he would ever receive the money.
Deferred Compensation is Not Income
12 Section 14-10-115, C.R.S. 2019, applies to child support
obligations established or modified under the UPA. §
19-4-129, C.R.S. 2019. We review child support orders for an
abuse of discretion. In re Marriage of Garrett, 2018
COA 154, ¶ 8, 444 P.3d 812, 815. However, we review de
novo the legal standard applied by the court. In re
Marriage of Tooker, 2019 COA 83, ¶ 12, 444 P.3d
13 A child support calculation begins with a determination of
the parties' combined gross incomes. See §
14-10-115(1)(b)(I), (5)(a). A parent's gross income for
child support purposes is "income from any
source[.]" § 14-10-115(5)(a)(I).
14 The statute, however, neither specifically includes nor
excludes "deferred compensation" as gross income
available to a parent. See id. (nonexclusive list of
income included in definition of gross income); §
14-10-115(5)(a)(II) (excluding certain income from definition
of gross income).
15 No Colorado case has addressed this specific issue. Thus,
we look to other Colorado appellate decisions addressing
whether financial benefits or contributions not specifically
defined by the statute are income for child ...