TOP TEN TIPS FOR SETTLING OR NEGOTIATING CHILD SUPPORT DISPUTES Family Law Section Program

JoAl Cannon Sheridan Ausley, Algert, Robertson and Flores, L.L.P. 3307 Northland Drive, Suite 420 Austin, Texas 78731 (512) 454-8791 (512) 454-9091 Fax [email protected]

Thursday, June 10, 2010 2:55 p.m. – 3:15 p.m.

 

JoAl Cannon Sheridan

Ausley, Algert, Robertson and Flores, L.L.P. 3307 Northland Drive, Suite 420 Austin, Texas 78731 (512) 454-8791 (512) 454-9091 fax [email protected] Education:

University of Texas at Austin, B.A. with honors, 1989 B aylor L aw Sc hool, J .D ., 1 99 2 (T op 20 % )

Licensure:

Texas Supreme Court (1992) Board Certified in Fam ily Law by the Texa s Board of Legal Specialization

Emp loymen t:

Former Briefing Attorney for Hon. Joe Draughn, 14th Court of Appeals, Hou ston (1992-1993) Partner, Cox, Sinclair & Sheridan, Rusk, Texas (1994-1996) Partner, Moak & Sheridan, L.L.P., (1996-2004)(Martin-Dale-Hubbell AV Rated Firm) Named Partner, The Sheridan Law Firm, 2005-2007 Joined the Firm of Ausley, Algert, Robertson and Flores, L.L.P., January 2008 to present

Areas of Practice:

Family Law

Professional Activities and Hon ors: *Baylor Law S chool 2004 Y oung Law yer of the Year *Recognized as a Texas Rising Star by Texas Monthly and Law & Politics Magazines (July 2004) *Recognized as a Texas Super Lawyer by Texas Monthly and Law & Politics Magazines (2004, 2005, 2006, 2007, 2008 and 2009) *Outstanding Third Year Director, SBOT Board of Directors (2001) *SBOT Presidential Citation and Award of Merit (2001 and 2004) *Director, State Bar of Texas Board of Directors (1998 -2001)(youngest ever elected); Cha ir, SBO T Boa rd Legislative Polic y Com mittee Cha ir, SBO T Boa rd Lega l Services C omm ittee Vice-Chair, SBOT Board Grievance and Disciplinary System Oversight Comm. M ember , Aud it and F inanc e Com mittee Speaker, New SBO T Director Orientation *Director, Board of Disciplinary Appeals (2008-2011) *Trustee, Texas Bar Foundation (2007-2010; Executive Committee 2010) *Trustee, Texas Family Law Foundation (2008-2011) *President, Baylor Law School Alumni Board (2009-10) *Appointee, Texas Supreme Court Referral Fee Task Force, 2004 *Nominee/Finalist, Texas Young Lawyers Outstanding Young Lawyer Award (2001) *Member/Director, Family Law Section Council (2001-2011) -Committees–Legislative, State Bar, Member Services, Pro Bono *Member, District 2A Grievance Committee, State Bar of Texas (2003-2009) *Member, SBOT CLE Comm ittee (2003-2006) *Trustee, Texas Center for Legal Ethics and Professionalism (2005-2007) *Member, General Practice Section Council (1996-2003) *CLE P lanning Com mittee, SBOT Annua l Meeting 1995 (Law O ffice Managemen t) *CLE P lanning Com mittee, SBOT Family Law Advanced Course (2004 , 2010; New Frontiers 2006, 2007 ; Marriage Dissolution, 2007; U T Fam ily Law on the Frontlines, 2008 , 2009; UT Parent-Ch ild Course, 2010) *CLE Speaker, “Follow the Yellow Brick Road–Jurisdiction and Venue, SBOT M arriage Dissolution 2010) *CLE Speaker, “Jurisdiction Jeopardy,” SBOT Advanced Family Law Course 2009 *CLE Speaker, “What Would Atticus Do?–Top 10 Ethical Mistakes Family Lawyers Make,” UTCLE Family Law on the Frontlines, June 2009 *CLE Speaker/panel, “Legislative Update,” UTCLE Family Law on the Frontlines, June 2009 *Course Director, SBOT Advanced Family Law Drafting Course, December 2008; *CLE Speaker and Author, “Difficult Child Cases,” SBOT Advanced Family Law Course, August 2008 *CLE Speaker, “Representing and Defending Against the Impaired Client, UTCLE Family Law on the Frontlines, June 2008; *CLE Speaker and Author, “Discovery Grab Bag,” SBOT Advanced Family Law Course August 2007; *CLE Speaker and Author, “Divorce Beyond Hate,” SBOT Marriage Dissolution Institute, May 2007;

*CLE Speaker and Author, “Digging Up Alcatraz: Revisiting The Rocks of Common Law and Uncommon Claims (Reimbursement), SBOT New Frontiers in Marital Property Law, October 2006 *CLE Sp eaker and Au thor, “Nobody’s D oin’ Wha t They’re S’posed To–E nforcing Child Supp ort and Possession Orders,” SBOT Advanced Family Law Drafting Course, August 2006 *CLE Speak er and A uthor, “S leeping W ith the En emy– Dom estic Violence and Protective Ord ers,” SB OT Adva nced Family Law Drafting Course, December 2005 *CLE Speaker and Author, “Here’s Hopi The Marriage Lasts–Protecting Separate Property Through the Use of FLP’s, Corporate Structures and Trusts,” SBOT New Frontiers in Marital Property Course, October 2005 *CLE Speaker and Author, “Avoiding Getting Cross With Your Cross Client,” Advanced Family Law Seminar, August 2005 *CLE Speak er and A uthor, “T he Best D efense is a G ood Offens e: Defendin g M odifications W ithout the T hird P rong,” Advanced Family Law Seminar, August 2004 *CLE Speak er and A uthor, “S ex, Dru gs, and B ody Pier cing-B ad Fa cts in C ustody C ases, Bo th for Ya and A gainst Y a,” Advanced Family Law Seminar August 2003 *Panel member, ‘Custody Cases,’ Advanced Family Law Seminar, August 2003 *CLE Speaker and Author, “Managing the File,” Advanced Family Law Seminar August 2002 *CLE Speaker, “New Millennium Ethics for the Small Town Practitioner,” Navarro County Bar Association, August 2001 *CLE Speaker on Ethics, Local Bar Leaders Conference Las Colinas, Texas August 2000 *Keynote speaker on Family Law, RACA conference, April 2007 *Frequent speaker on Constitutional and Legal issues at Jacksonville ISD, Henderson ISD, Athens ISD, Wells ISD *Guest Lecturer, Lon M orris College Leadership Class (200 2 through present) *President, Cherokee County Bar Association 1997-98 *Director, Baylor Law School Alumni Association (2006-2009) *Voted “Jacksonville’s Favorite Attorney,” Jacksonville Daily Progress 2004 COMMUNITY HONO RS/ACTIVITIES *Mem ber, St. Johns United M ethodist Church, (C hancel Choir, Ha ndbells, Trinity Singers, Passionate W orship Comm ittee) (July 2008 to present) *Member, First United Methodist Church, Jacksonville, Texas (June 1994 through January 2008) -Chair, Administrative Board (2002) -Cha ir, New Build ing Finance C omm ittee -M ember , Finan ce Com mittee -Sun day Sc hool Tea cher “Spirit of Faith” Class (Mentally handicapped adults) “Alpha O mega” Class (Senior adults–2nd S unday teacher) -Recipient, Texas Methodist Conference Outstanding Sunday School Teacher Award, Southern District (1996) -Mem ber, FUM C Cha ncel Choir -Mem ber, “Brown B ag Ringers” Bell Choir *Jacksonville Chamber of Commerce Chair of the Board, 2002 Treasurer, 2000-2001 *Jacksonville Rotary Club Director/Chair, Community/Public Service Division, 1998-present President-Elect 2003 President 2004-2005 (first woman president of J’ville club) *Director, Nan Travis Hospital Foundation Board (2006-2009) *Nominee, Texas Governor’s “Lone Star Award” for Volunteerism, 2003 *United Fund of Jacksonville Board of Directors 2002-2006 *Soup K itchen V olunteer *Member, Jacksonville Tennis League Teams (3.5 and 4.0) *Advisor, Boy Scout Law Explorer Post (co-ed) 1995-2000 *JISD Leadership/C areer Da y Speak er and R ead-a-th on speaker *Certified D ive M aster (profess ional level) an d Resc ue Diver **Specialty C ertification–Shark Diving a nd E duca tion (Grand C ayma n, B.W .I.) *Member, United States Tennis Association (current rating–4.0) -Quarter-finalist, 2005 National Mixed Doubles Championship (3.0) PERSONAL INFORMATION: Born M exia, Texas, M arch 7, 1967 to Joe B. and the late Alice Jean Sund berg Cannon Married Dr. Dirk Sheridan, Ed.D. November 6, 1993 Proud ow ner (“mother”?) of Dom ino, Gizelle, and Excel,(dogs), and D aVinci,(cat), not to mention several unnam ed salt water fish ....

TOP 10 TIPS FOR SETTLING AND NEGOTIATING CHILD SUPPORT DISPUTES I.

INTRODUCTION

In family law cases involving children, one of the top “hot button” issues for parents is the topic of child support. It is not uncommon for parties in these cases to have reached agreements on property division, conservatorship and visitation, but when it comes to the term “child support,” communications can often break down. While many cases may fall into the category of a straight “guidelines case,” those with wage-earning parents whose monthly net income exceeds $7500, or those with special needs children, do not. The following are 10 tips that I have either utilized in my own practice or have obtained from my colleagues in how to settle and negotiate child support disputes. As most of us who practice family law know, we can be much more creative if we can resolve these issues by settlement rather than hashing them out in court, when the judge is likely to issue a ruling that no one likes! II.

Top Ten Tips

Number 10–Talk in terms of activities and specific needs rather than “dollars.” Unless a child is very young, it is likely that a certain standard has been established regarding the care, education, and activities of the child. For example, if the child is school age, there has likely been a precedent set as to whether the child will attend public or private school. There will be an idea as to the child’s interest in various extra curricular activities. There will have been a pattern established of summer camps,

T-Ball, cheerleading and the like, and the expenses that go along with those activities. It will be known if the child has special medical or educational needs, and the past and anticipated costs of those. Parents, and their lawyers especially, can easily fall into the rut of simply applying guideline support and dividing the uninsured medical equally. But this method does not incorporate extra curricular activities, school supplies, cheerleading uniforms, and special tutors. Those who are ordered to pay child support can often feel pressure and resentment simply from the term, and all of us who do this work know that the Obligor often perceives that the child support is not going to the benefit of the child. In the cases where a pattern of expenses, needs and activities have been established, it often promotes settlement to draft an order that requires the Obligor to pay these expenses directly to the provider, rather than the custodial parent, because the Obligor then gets the sense that the funds are directly benefitting the child. The amounts to be paid can still be characterized as child support, (and therefore enforceable by contempt), but the Obligor can at least feel that they have some control over a portion of the money he or she is paying. Number 9–Be Creative -Although the family code is chock full of “guidelines,” they are exactly that– guidelines. As I often tell my clients, each case is different and each child’s needs are different, even if there are common themes. How often have we had clients who say they want a 50/50 possession schedule because that means they do not have to pay child support. NOT! However, when incorporating the child’s known needs with the parents’ respective situations, creativity can rule the day in achieving a child support

order that everyone can live with and that is much more flexible than what the court is able to do. For example, if the parties want a true 50/50 possession schedule, calculate what each party’s child support would be and make the difference the child support amount. In that regard, it has been my practice to specifically note how the child support was calculated so as to set a benchmark for “material and substantial change” later on. This concept also applies to expenses not necessarily included in child support, such as uninsured medical, etc. I find it helpful to compare both parties’ income, determine the percentage each person’s salary was to the whole during the marriage, and then use that number to require BOTH parents to contribute at their respective percentages to those other expenses. This can be used as the entire support model as well, if the parties choose to each contribute to the child’s expenses, rather than doing an offset. In those cases, both parents often feel ownership and responsibility for the child, and do not feel “used” for their pocketbook. Number 8– Don’t forget travel expenses– When parents live in different counties that require substantial travel to accomplish visitation, that is an important factor to consider in setting child support. If one party must bear the majority of the travel expenses, then a reduction in child support commiserate with those expenses may well be warranted. This is especially true in situations where it was the custodial parent’s choice to move away and child support was established when the parties lived closer together. This consideration is especially true in these days of rapidly rising gas prices and airline travel. If this is the situation you find your clients in, it is a good idea to come prepared

with figures, gas receipts, etc., that support the added expenses incurred in exercising the visitation. While beyond the scope of this article, a coinciding issue is also pick up and return times for the child to minimize the travel time and maximize the possession time as much as possible. Number 7– Non-cash income– One of the most overlooked sources of income when negotiating child support is non-cash income. While the current recession and employment situation is such that many companies have eliminated these benefits, they do still exist. Housing allowances (or gratis housing), use of business vehicles, cellular phones, free internet, per diem allowances, all may be included in calculating net income. Obviously, the party receiving the benefits may not want it included, since it is not ‘cash-in-hand.’ However, if you are representing the custodial parent who does not receive these benefits, it may be helpful to do a little research and show the value equivalent of those benefits which the Obligor is saving. As primarily visual learners, this can be a powerful tool in convincing an Obligor to spend some of those “savings” for the benefit of the child. Number 6– “Lifestyle” and “Proven Needs”I would venture to guess that each one of us has argues to the court that “lifestyle” is not relevant to calculating child support. Baloney! As one judge commented to a colleague, “Do they expect the kid to live in a tent?!” This is especially true in cases of higher wage-earning parents. It is illogical to me that there is a perception that the Michael Dell’s and Donald Trump’s of this world would only be required to pay guideline support up to a cap of $7500 net

resources, while the poor schmuck who brings home $7600 per month pays maximum guidelines. The term “proven needs,” then, is the new code for “lifestyle.” If a child has attended Camp Longhorn for 7 years, taken gymnastics at the Karolyi institute, or is a prodigy of YoYo Ma, then the parents’ divorce shouldn’t interfere with those activities unless there is a true financial hardship placed upon the families. Often when couched in terms of “continuation, stability and consistency of activities,” it is easier for the parents to agree to the payments. Number 5– Be Realistic– While the lifestyle a child has enjoyed is and should be a valid consideration in setting child support, the parties (and the lawyers!) must be realistic as well. The majority of people spend most of what they make, or live beyond their means. Even the more affluent clients may experience sacrifices when having to establish two households, two decreased budgets, increased travel expenses, increased responsibility as single parents, etc. Some tough financial decisions may have to be made, and these may result in the elimination of some of the child’s activities in favor of accommodating their favorite ones, or to make up for the additional funds expended to exercise possession. Likewise, this is not the time to present the “Christmas Wish List” that did not exist before. It is not realistic to expect a parent to buy into paying for summer camps if the child has never been. If the parties usually shop at Target, this is not the time to insist on Saks Fifth Avenue clothing prices. Preparing a realistic budget for BOTH sides to illustrate where the money will be going may be the best way to engage in a reality check in negotiating child support.

Number 4– Focus on Goals instead of Dollars– When trying to negotiate above guideline support, I often find it easier to address the issue in the form of “goals for the children” as opposed to mere dollars and costs. Rarely have I met a parent who does not truly want what is best for their child, or that does not desire to sacrifice to provide the best they can. When discussions begin with “What are your long-term goals for your child with regards to education, sports, travel and activities,” this helps the parent focus on the hopes and dreams he or she has for the child. (I.e.–they always hoped the child would go to Harvard; the child has shown a talent in baseball/gymnastics/violin). Then the next question is, “What do you think the child needs to accomplish those goals?” This makes the parent begin to think about the private tutors, piano lessons, sports camps, etc. that are necessary to make these dreams reality. Then it is time to put pencil to paper regarding the costs associated with making those goals materialize. However, starting with the aspirations often helps ease the Obligor into the understanding that while the goals are wonderful, they cost money. But if the Obligor shares in the goals for the child, then the money is simply the natural byproduct he/she must pay to have ownership of those goals. Number 3– Be honest with opposing counsel– Sounds like a no-brainer, right? Wrong. I am constantly amazed at the number of lawyers who will hide the ball (and the income) in order to appear to be an aggressive litigator. Don’t do it. It costs you credibility, and hurts you when you’re on the flip side of another case with that

lawyer. Plus, the facts almost always come out eventually, and then it completely diminishes the lawyer’s ability to negotiate a settlement because the other side does not believe them. Number 2– Be honest with your client-- If your client is not being realistic, then you need to tell them so (in a nice way, of course!). If your client is being unreasonable or taking an untenable position, they need to know it. Explain the cost/benefit analysis of negotiating a settlement as opposed to spending enormous attorneys fees for a less desirable result. Explain the likelihood (or lack thereof) as to whether their position will stand up in court. Tough love isn’t just for 12-step programs anymore. We do not do our clients any favors when we allow them to take inappropriate positions or when we fail to encourage settlement. We can zealously represent our clients by encouraging creative solutions that save time, money, and emotional damage in the long run. Number 1– Be empathetic– Times are tough. Job security for an obligor is a thing of the past. High income earners can find themselves without a job or having to work for greatly reduced wages. Bring proof of reduced income with no promise of increase, rather than just assuming you should average the last three years of tax statements. Encourage settlement, and remind the parties and lawyers that for every dime saved by settling, they can contribute to their children’s college funds! Conclusion-While I doubt any of these suggestions were earthshattering, I do hope they can serve as a guidepost to your child support negotiations. Creativity,

understanding, and honesty go a long way in settling these often hot-button, divisive cases. Best of luck!