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Clarke v. Clarke – 2023 UT App 160

2023 UT App 160

THE UTAH COURT OF APPEALS

EDWIN M. CLARKE,

Appellee,

v.

ANGOZI R.S. CLARKE,

Appellant.

Opinion

No. 20220067-CA

Filed December 29, 2023

Third District Court, Silver Summit Department

The Honorable Teresa Welch

No. 174500147

Cassie Medura and Jarrod H. Jennings,

Attorneys for Appellant

Julie J. Nelson and Rebecca Ross,

Attorneys for Appellee

JUDGE RYAN M. HARRIS authored this Opinion, in which JUDGES GREGORY K. ORME and JOHN D. LUTHY concurred.

HARRIS, Judge:

¶1        After about twenty years of marriage, Edwin (Ed) and Angozi (Anne) Clarke separated in 2016, and their divorce case proceeded to a four-day bench trial in late 2020 and early 2021. Anne appeals from some of the trial court’s findings and conclusions regarding the financial aspects of the case, chiefly the court’s determination as to how much alimony Ed was ordered to pay. And she appeals the court’s denial of her motion for a new trial. We reject Anne’s arguments and affirm the court’s rulings.

 

BACKGROUND

¶2        Ed and Anne[1] married in September 1996. Ed commenced this divorce action in 2017. During their marriage, the parties had three children together, none of whom are minors now and only one of whom was a minor at the time of trial. The bulk of the pretrial litigation in this case concerned the parties’ children, but none of the trial court’s eventual rulings regarding custody are at issue in this appeal; rather, the matters at issue here are exclusively financial.

¶3        Ed is an airline pilot by trade, and in the years leading up to trial he worked for Delta Air Lines (Delta); in 2016, he was promoted to captain. Anne was also employed during the marriage; the trial court found that, since 2006, she had been “self-employed as an Independent Clothing Salesperson” affiliated with a clothing company. Prior to trial, the parties exchanged several financial disclosures, including information about their respective incomes and claimed monthly expenses. As trial approached, the court entered a pretrial order commanding that the parties exchange “[u]pdated [f]inancial [s]tatements . . . 21 days prior to the scheduled trial date.”

¶4        Trial was eventually scheduled for a three-day setting in November 2020. In keeping with the pretrial scheduling order, the parties exchanged updated financial information in the weeks prior to the scheduled trial date. Anne submitted an updated financial declaration in September 2020, therein asserting that her gross employment income was $1,674 per month (not including alimony and child support payments Ed was making pursuant to a temporary order), that her total net income (including alimony and child support, but after taxes) was $3,894 per month, and that her expenses were $8,093 per month. Regarding expenses, the form she used contained two columns for each line item, one for the “current amount” and one for “marital expenses.” Anne filled out only the “current amount” column; she left the “marital expenses” column blank.

¶5      In his final pretrial disclosures, Ed submitted an updated financial declaration indicating that his net income was $14,849 per month. Regarding expenses, Ed filled out both columns, indicating that his “current” expenses were $16,399 and that his monthly “marital expenses” had been $17,007. Ed also produced documentation supporting his assertions regarding income and expenses, including his tax returns from 2015 through 2019, as well as a paystub dated September 30, 2020 that included 2020 year-to-date income information. While Anne raised one pretrial concern with Ed’s financial disclosures, she did not litigate that concern to completion,[2] and she lodged no other objection prior to or during trial to the scope of Ed’s financial disclosures.

¶6        Trial began on November 10, 2020. The most prominent issues at trial were financial ones, chiefly Anne’s request for alimony, and much of the trial was devoted to evidence of the parties’ respective incomes and expenses. The disputes were especially pointed regarding Ed’s income and Anne’s expenses. Neither side called any financial experts to the stand; the only witnesses to offer evidence regarding the parties’ finances were the parties themselves.

¶7        Ed was on the witness stand for the better part of three days, and he offered testimony about his income. He explained that, in 2016, he was promoted to captain and thereby earned a substantial raise, and that during the years 2016 through 2018 he earned relatively consistent annual amounts, from approximately $271,000 to $292,000. In 2019, however, he earned a significantly higher salary, making approximately $349,000. He testified that, given the COVID-19 pandemic and the ensuing change in worldwide travel conditions in 2020, this 2019 pay increase was anomalous and not representative of his earning capacity at the time of trial. He explained that his 2019 income was higher than usual because, during that year, “Delta experienced a pilot shortage” that enabled him “to work significant overtime” during this “high demand time.” And he explained that the pandemic had significantly impacted Delta’s business in several ways. In 2020, there were “far too many pilots for the flight schedules being flown,” and therefore he was not able to work even pre-2019 hours, let alone the increased 2019 hours. In addition, he explained that before the pandemic, he had, as a captain, received a profit-sharing payment from Delta; that payment from 2019 had been significant, totaling over $51,000. But he testified that, given the state of Delta’s business in 2020, he was unlikely to receive any profit-sharing payment for that year, or for the foreseeable short-term future. He testified that, given these circumstances, the income that he received during September 2020—as reflected on his paystub from that month—was most indicative of his earning capacity moving forward. In his proposed post-trial findings, Ed indicated that his net monthly income was $13,358.32, based on then-current tax codes. And he testified that his marital expenses were consistent with what he had listed on his most recent financial declaration.

¶8        Anne offered very little testimony regarding her income and expenses. She did, however, testify briefly about certain business expenses that she believed should be deducted from her income for alimony purposes. She offered no testimony regarding her total net income or how it should be computed, but she indicated in written filings (including her post-trial proposed findings) that her net income from employment (not including alimony and child support) was $920 per month.

¶9        Both parties also testified that they should receive credit, or “offsets,” for previous expenditures made using their personal funds for items or matters for which they believed both parties should be equally responsible. For instance, Ed asked for reimbursement of payments he made for maintenance of the marital home and for certain child-related expenses. Anne asked for repayment of other child-related expenses and for costs incurred in moving out of the marital home around the time of separation, and she sought some sort of credit for various other instances where she alleged Ed had used her personal funds.

¶10      As the three scheduled November 2020 trial days drew to a close, it became apparent that the parties were going to need additional time to present their evidence. After some discussion, the court agreed to schedule a fourth trial day, but the parties and the court did not have mutual availability until February 2021. Thus, the court scheduled a fourth trial day for February 11, and it scheduled closing arguments to take place on March 9.

¶11      A few weeks after the closing arguments, the court issued a lengthy ruling containing its findings of fact and conclusions of law.[3] In that ruling, the court indicated that it found Ed’s testimony about his income to be credible, and on that basis determined that the years 2019 and 2020 were both anomalous with regard to Ed’s income, and that neither year was “indicative of his normal or foreseeable income.” Instead, the court determined that the most accurate measure of Ed’s earning capacity, as of the time of trial, was an average of his 2016, 2017, and 2018 earnings. The court also believed that Ed was unlikely to receive profit-sharing income from Delta “for the foreseeable future.” Thus, the court did not include profit sharing as part of Ed’s gross income calculation. Using Ed’s 2016, 2017, and 2018 tax returns and averaging the income figures found there, the court determined that Ed’s gross monthly earning capacity, for child support and alimony purposes, was $20,452.25. And the court calculated Ed’s net income “by applying current tax rates to” the gross income figure it had come up with. Using this methodology, the court calculated Ed’s net monthly earning capacity as $13,358.32. And it calculated Ed’s reasonable monthly expenses, in light of the marital standard of living, to be $10,249.46.

¶12 The court calculated Anne’s gross earning capacity by averaging her earnings from 2015 through 2019 and then concluding, on that basis, that her earning capacity was $3,158.50 per month. The court declined Anne’s invitation to subtract business expenses from that figure, noting that, under applicable law, “[o]nly those expenses necessary to allow the business to operate at a reasonable level may be deducted from gross receipts,” and concluding that Anne had “failed to explain which, if any, business expenses claimed on her tax returns are necessary to allow [her clothing enterprise] to operate at a reasonable level.”

¶13      The court then noted that “[n]o testimony was offered at trial regarding” how to calculate Anne’s net income. The court found it “difficult to ascertain the amount of tax [Anne] actually [paid] based upon her income” given that Anne had “been receiving alimony during the pendency of the case” and had been “responsible for the tax consequences of her alimony income,” but due to changes in the tax code subsequent alimony payments would “be received tax-free.” Given these difficulties, the court looked to Anne’s 2017 tax return for guidance, and it determined that Anne had paid $390.35 in taxes on a monthly basis that year; it then applied that same tax-paid figure to Anne’s future income. Using this methodology, the court determined that Anne’s net monthly earning capacity was $2,768.25.[4]

¶14 In determining Anne’s reasonable monthly expenses, the court primarily relied on Anne’s most recent financial declaration. The court found Anne’s latest declaration to be more credible than earlier versions, explaining that Anne had testified that one of the earlier declarations was “inaccurate,” and opining that another one was “uncredible” because it claimed monthly expenses that were “more than the gross earnings of both Parties combined for the last full year of the marriage.” For the most part, the court found the expenses claimed in Anne’s most recent declaration “to be reasonable in light of the marital standard of living.” However, the court found that a few of the listed expenses were “post-separation debt for which [Anne was] solely responsible,” and it therefore deducted those expenses from the calculation. But without being asked to do so, the court added to Anne’s list a line item for health care expenses. With these adjustments, and based largely on Anne’s own requests, the court calculated Anne’s reasonable monthly expenses as $6,218.

¶15 Using these findings and conclusions, the court then computed Anne’s alimony award. In particular, it concluded that Anne had a monthly shortfall of $3,449.75 (the difference between Anne’s expenses and her earning capacity). And it concluded that Ed had capacity to pay $2,937.11 (the difference between Ed’s expenses and his earning capacity). The court split the difference between these figures, in an effort to “equalize the poverty,” as it were, and therefore ordered Ed to pay alimony to Anne in the amount of $3,193.43 per month. Separately, however, the court ruled that, in the event Ed did “receive profit sharing amounts” from Delta “during the years that [he] is paying alimony” to Anne, he would be required to make an additional payment to Anne of half of any such amount, after taxes.

¶16 The court also made a separate finding regarding the amount that the parties had been spending on a monthly basis during the marriage, an amount the court referred to as “the parties’ marital standard of living.” Using the expenses listed on Ed’s financial declaration as a starting point (after all, he was the only one who had filled out the “marital expenses” column on the form) and then making certain adjustments, the court concluded that the parties “marital standard of living” was $15,745.73 per month. But this figure did not play any role in the court’s mathematical calculation of Anne’s alimony award; as noted, the court calculated that amount by computing Anne’s shortfall and Ed’s ability to pay, and then by “equalizing the poverty.”

¶17      The court also made rulings dividing the parties’ property, assets, and debts, and most of those rulings are not at issue in this appeal. As relevant here, however, the court awarded Ed offsets for certain expenditures that “were used for family or child-related expenses, for which [Anne] should be equally responsible.” Anne also requested offsets, but the court declined to award them for several reasons, most notably because the court found that Anne “failed to provide credible and sufficient proof” supporting her requests. The court also concluded that Anne’s requests for offsets had not been timely asserted because they were “first mentioned in her Trial Brief (filed five days before trial)” and therefore Ed had been deprived of any opportunity to “conduct discovery on these requested offsets.”

¶18      Later, the court entered a decree of divorce incorporating its findings and conclusions. A few weeks after that, Anne filed a motion asking for a new trial or, in the alternative, for amendments to the decree. The main grievance asserted in this motion was Anne’s allegation that Ed had withheld relevant financial information indicating that his income was higher than he testified at trial. Shortly before filing this motion, Anne had obtained a copy of Ed’s 2020 W-2 form which, in her view, indicated that Ed had earned approximately $25,000 per month in gross income during October, November, and December 2020. Anne argued in her motion that Ed was in possession of this information during trial—certainly by the fourth day of trial, which was held in February 2021—but he did not inform her or the court of these developments. Anne also claimed that there existed “new evidence” showing that Ed was back to working at least some overtime hours during 2021 and that Delta was recovering from the pandemic faster than Ed had testified.

¶19      After full briefing, the court denied Anne’s motion, stating that Anne “did not prove the existence of newly discovered evidence that existed at the time of the trial (as opposed to facts or evidence that occurred subsequent to trial),” and noting that a “petition to modify is the appropriate mechanism for any pertinent changes that occur after trial.”

ISSUES AND STANDARDS OF REVIEW

¶20      Anne now appeals, taking issue with certain aspects of the court’s post-trial findings and conclusions, as well as with the court’s denial of her motion for a new trial.

¶21      As noted, all of Anne’s challenges to the court’s findings and conclusions involve financial rulings. “In divorce actions, a [trial] court is permitted considerable discretion in adjusting the financial and property interests of the parties, and its actions are entitled to a presumption of validity.” Gardner v. Gardner, 2019 UT 61, ¶ 18, 452 P.3d 1134 (quotation simplified); see also Miner v. Miner, 2021 UT App 77, ¶ 11, 496 P.3d 242 (“We review all aspects of the trial court’s alimony determination for an abuse of discretion . . . .” (quotation simplified)). “We will reverse only if (1) there was a misunderstanding or misapplication of the law resulting in substantial and prejudicial error; (2) the factual findings upon which the award was based are clearly erroneous; or (3) the party challenging the award shows that such a serious inequity has resulted as to manifest a clear abuse of discretion.” Gardner, 2019 UT 61, ¶ 18 (quotation simplified). “Appellants have a heavy burden to show that an alleged error falls into any of these three categories” because “we can properly find abuse only if no reasonable person would take the view adopted by the trial court.” Id. (quotation simplified).

¶22      Anne also challenges the court’s denial of her motion for a new trial. “There are two aspects to a court’s decision-making process in ruling on a motion for new trial, and there are differences in the manner in which we review each aspect.” Peterson v. Hyundai Motor Co., 2021 UT App 128, ¶ 30, 502 P.3d 320 (quotation simplified), cert. denied, 509 P.3d 768 (Utah 2022). “First, a trial court must determine that there exists a problem . . . that may require a retrial.” Id. ¶ 31. Some of the grounds for retrial listed in rule 59(a) of the Utah Rules of Civil Procedure “cannot be found to exist without some sort of factual determination on the part of the trial court,” and we review any such determination for abuse of discretion. Id. But other grounds, such as “the existence of legal errors,” “require no factual determination on the part of the trial court,” and rulings on these grounds are reviewed for correctness. Id. “Second, after determining that an error or impropriety of some kind exists, a trial court must determine whether the identified errors or improprieties are significant enough to warrant a retrial.” Id. ¶ 32. And this determination is usually reviewed for abuse of discretion. Id.

ANALYSIS

¶23      In this appeal, Anne challenges two aspects of the court’s rulings regarding the parties’ finances. Chiefly, Anne takes issue with the court’s alimony award; in her view, the award was, for several reasons, not big enough. She also asks us to review the court’s decisions regarding the parties’ claimed offsets. For the reasons explained below, we reject Anne’s challenges.

I. Alimony

¶24 Anne assails the court’s alimony award on several grounds. First, she takes issue with the court’s rulings regarding Ed’s gross monthly earning capacity. Second, with regard to her own earning capacity, she challenges the denial of her request that the court take into account certain claimed business expenses.[5] Third, she asserts that the court erred in computing the parties’ net (after-tax) incomes. And finally, she assails the overall alimony computation, arguing that the court did not properly take the parties’ pre-separation standard of living into account in assessing her reasonable monthly expenses. We discuss each argument, in turn, and find none of them persuasive.

A. Ed’s Gross Earning Capacity

¶25 Anne’s challenge to the court’s rulings regarding Ed’s gross earning capacity has two parts. First, Anne asks us to review the court’s original findings and conclusions. And second, Anne takes issue with the court’s denial of her motion for a new trial.

1

¶26      After considering the evidence presented during the four-day trial, the court made findings regarding Ed’s earning capacity. In particular, it determined that Ed’s current earning capacity, viewed from the perspective of a trial that occurred in late 2020 and early 2021, was best estimated by looking at his income in 2016, 2017, and 2018. In the court’s view, Ed’s 2019 income was anomalous, because he had worked significantly more that year than in previous years, and he was unlikely to work that much in the near future. And the court determined not to use Ed’s 2020 income either, given the uncertainty in the airline industry that year due to the pandemic. The court decided that the best indicator of Ed’s current earning capacity was an average of the three years prior to these two anomalous years. And the court determined not to include Delta profit-sharing payments in the income calculation, on the basis that—at the time of trial— airlines were struggling due to the pandemic and therefore Ed was unlikely to receive any profit-sharing payments “in the foreseeable future.” Using these parameters, the court calculated Ed’s “gross monthly income” as $20,452.25.

¶27 There was ample evidence presented during the trial to support these findings and conclusions. The parties presented tax returns and paystubs setting forth Ed’s salary and other income, and Ed offered extensive testimony in this regard that the court expressly found credible.[6] The court also heard evidence regarding conditions in the airline industry in 2019 and 2020, and about the COVID-19 pandemic. The trial record therefore contains evidence sufficient to support the court’s findings regarding which years to use in the income calculation, and regarding the specific amounts computed. And where there exists evidence sufficient to support a court’s rulings regarding a divorcing couple’s finances, that ruling will be upheld on appeal, even if evidence was presented that might have cut the other way. See Kimball v. Kimball, 2009 UT App 233, ¶ 20 n.5, 217 P.3d 733 (“The pill that is hard for many appellants to swallow is that if there is evidence supporting a finding, absent a legal problem—a ‘fatal flaw’—with that evidence, the finding will stand, even though there is ample record evidence that would have supported contrary findings. After all, it is the trial court’s singularly important mission to consider and weigh all the conflicting evidence and find the facts.”).

¶28 Anne resists this conclusion by asserting that the court specifically erred in excluding any profit-sharing payments from the income calculation. She points out—correctly—that Utah law defines “gross income” as including “prospective income from any source.” See Utah Code § 78B-12-203(1). But the court found— based on prevailing economic conditions existing at the time of trial—that Ed was unlikely to “receive profit sharing payments for the foreseeable future,” and on that basis chose not to include those amounts in its calculation of Ed’s income. As noted, there was evidence to support this determination, and it therefore survives Anne’s appellate challenge.

¶29 Moreover, we have held that, while trial courts must “consider all sources of income when determining alimony,” Utah law “does not dictate that all sources of income be counted as income received by a spouse for that purpose.” Eberhard v. Eberhard, 2019 UT App 114, ¶ 21, 449 P.3d 202. Instead, our case law “preserv[es] a [trial] court’s broad discretion to treat sources of income as the court sees fit under the circumstances.” Id. Here, the trial court certainly considered the profit-sharing component of Ed’s historical income. And after consideration, it determined not to include profit sharing in Ed’s income calculation due to unfavorable economic conditions in existence at the time of trial, but it did order—separately—that, if economic conditions improved and Ed ended up receiving profit-sharing payments from Delta “during the years that [he] is paying alimony” to Anne, Ed would be “required to pay [Anne] half” of any such payments. As Ed points out, this order has the potential to be much better for Anne, in terms of dollars received over time,

than the order she is now asserting the court should have entered. But more to the point, it was well within the court’s discretion to craft this sort of creative solution to the parties’ alimony conundrum.

¶30      In short, the trial court’s findings regarding Ed’s gross monthly earning capacity were amply supported by evidence presented during the trial, and the court’s final computations and orders were not an abuse of its discretion.

2

¶31 Next, Anne takes issue with the court’s decision to deny her motion for a new trial. In that motion, Anne asked the court to order that a new trial be held in light of information— that she claimed was new—regarding Ed’s income. In particular, Anne asserted that Ed had, during trial, withheld relevant financial information indicating that his income in late 2020 and early 2021 was higher than he testified at trial. Anne also claimed that there existed “new evidence” that Ed was back to working at least some overtime hours during 2021 and that Delta was recovering from the pandemic faster than Ed had testified. The court denied Anne’s motion, and declined her invitation to order a new trial. We perceive no error in this determination.

¶32      Under applicable rules, a new trial “may be granted to any party on any issue” for any one of several enumerated reasons. See Utah R. Civ. P. 59(a). Those reasons include “irregularity in the proceedings of the court, . . . or any order of the court, or abuse of discretion by which a party was prevented from having a fair trial,” id. R. 59(a)(1); “newly discovered material evidence that could not, with reasonable diligence, have been discovered and produced at the trial,” id. R. 59(a)(4); “insufficiency of the evidence to justify the verdict or other decision,” id. R. 59(a)(6); and “the verdict or decision [being] contrary to law or based on an error in law,” id. R. 59(a)(7). Anne asked for a new trial under each of these subsections, and we discuss them in turn.

¶33      Rule 59(a)(1): Anne first argues that she is entitled to a new trial because of an irregularity in the proceedings. She points to Ed’s 2020 W-2 form, which she obtained in September 2021 (several months after the conclusion of the trial), and she asserts that Ed’s testimony at trial was inconsistent with that document. She characterizes Ed’s testimony as materially inaccurate, and she accuses him of being less than candid with the court.[7] Based on these assertions, she concludes that there was an irregularity in the trial proceedings sufficient to justify a new trial.

¶34 In this vein, Anne asserts that Ed had an ongoing obligation, which continued even during trial, to supplement his pretrial disclosures with up-to-date financial information. She acknowledges that Ed provided then-current financial information in his final pretrial disclosures, which the court ordered the parties to exchange some three weeks prior to trial; this information included Ed’s September 2020 paystub, including year-to-date income information. But she asserts that, despite Ed’s compliance with the court’s pretrial disclosure order, Ed violated his ongoing supplementation obligation, an event she asserts contributed to creating an “irregularity” in the trial proceedings. She points out that, even though the trial was originally scheduled to conclude over three days in November 2020, the court eventually scheduled a fourth trial day to take place in February 2021. She acknowledges that, ordinarily, a party discharges its pretrial disclosure obligations by complying with the court’s pretrial disclosure order, but she asserts that, under the unique circumstances of this case—in which trial was extended for another three months, into another calendar year—Ed became obligated to update his financial disclosures without further order of the court and without any request on her part.

¶35 We are unpersuaded. When it scheduled the fourth trial date, the court did not amend its pretrial disclosure order, or otherwise command the parties to update their financial disclosures, one more time, prior to that trial date. We also note that Anne herself did not attempt to supplement her disclosures during trial (for instance, she did not provide her own year-end 2020 financial information to Ed prior to the fourth trial date in February), nor did she complain to the trial court, during trial, about Ed’s failure to do so.

¶36 And Anne cites no statute or case law in support of the specific position she advocates. The only rules to which she directs our attention are the ones containing parties’ general disclosure and supplementation obligations. See Utah R. Civ. P. 26(d)(5), 26.1. We acknowledge Anne’s point, and certainly agree with her that, during litigation, parties have ongoing supplementation obligations regarding their discovery disclosures. But we are aware of no specific rule compelling parties to continue to provide updated financial information after the final pretrial disclosure deadline; indeed, as we understand it, trial courts often set such deadlines so that trials can proceed in an orderly fashion and facilitate assessment of the litigants’ situation as of the date of the final financial disclosures.

¶37      Moreover, in the family law context, there exists a specific remedy for situations in which a party’s income changes materially after a trial has been held and findings about the parties’ financial situation have been made: a party may file a petition to modify the existing order. See id. R. 106; Utah Code §§ 30-3-5(11)(a), 78B-12-210(8). Indeed, in this case, the trial court

denied Anne’s motion for a new trial, at least in part, because it concluded that a “petition to modify is the appropriate mechanism” for addressing “any pertinent changes” in Ed’s income that have occurred “subsequent to trial.” We agree with the trial court that, ordinarily, the petition to modify remedy is the method that should be used to address post-trial changes in divorcing parties’ financial status. That remedy remains open to Anne here, despite the court’s denial of her motion for a new trial.

¶38      For all of these reasons, we perceive no abuse of discretion, under the circumstances presented here, in the trial court’s conclusion that Ed’s failure to provide ongoing paystubs and W-2 forms he received after the court’s final pretrial disclosure deadline did not constitute the sort of “irregularity in the proceedings” that would justify a new trial.

¶39      Rule 59(a)(4): Next, Anne argues that a new trial is necessary because of newly discovered evidence. See Utah R. Civ. P. 59(a)(4). Again, she points to Ed’s 2020 and 2021 W-2 forms, as well as new evidence about Delta’s 2021 resurgence, and asserts that this evidence constitutes “newly discovered material evidence” that would justify a new trial. We remain unpersuaded.

¶40      As an initial matter, “a motion for a new trial or amended judgment cannot be based on facts occurring subsequent to trial.” In re C.L., 2007 UT 51, ¶ 14, 166 P.3d 608 (quotation simplified). “Otherwise, there would be no end to litigation.” Id. (quotation simplified). Some of the “newly discovered evidence” obviously fits into this category: Ed’s 2021 W-2 was not available until well into 2022, and evidence of Delta’s 2021 resurgence was not available during any of the trial dates in this case.

¶41      Ed’s 2020 W-2 form, on the other hand, may well have been available, at least to Ed, prior to the fourth and final trial date in this case, which took place on February 11, 2021. But in order to demonstrate that the evidence in question is the kind of evidence that fits within rule 59(a)(4), Anne must show that the evidence “could not, by due diligence, have been discovered and produced

at trial.” Id. ¶ 12 (quotation simplified); see also Utah R. Civ. P. 59(a)(4) (stating that, to be “newly discovered material evidence,” the evidence in question “could not, with reasonable diligence, have been discovered and produced at the trial”). In our view, Anne has not carried her burden of demonstrating that Ed’s 2020 W-2 form could not have been discovered and discussed during the February 11 trial date. Ed testified during the proceedings on February 11, and Anne’s attorney had the opportunity to ask Ed questions that day. Yet Ed was not asked any questions about his income during late 2020 or early 2021, and in particular he was not asked if his income had changed appreciably in the months since September 2020, the last month for which documentary information had been presented during the November 2020 trial dates. We are hard-pressed to conclude that information about Ed’s income during the last three months of 2020 and the first two months of 2021 “could not, with reasonable diligence, have been discovered and produced” at the February 11 trial date, when Anne had the chance to ask Ed about those issues and did not.

¶42      For these reasons, we discern no abuse of discretion in the trial court’s determination that no new trial was warranted under rule 59(a)(4).

¶43      Rule 59(a)(6): Next, Anne suggests that the trial court should have granted a new trial on the basis that there was insufficient evidence to justify its conclusions. See Utah R. Civ. P. 59(a)(6). We need not discuss this issue further, however, given our conclusions—set forth above—that sufficient evidence existed to support the trial court’s original findings and conclusions regarding Ed’s gross earning capacity.

¶44      Rule 59(a)(7): Finally, Anne asserts that the trial court should have granted a new trial because its initial findings regarding Ed’s income were “contrary to law or based on an error in law.” See id. R. 59(a)(7). But in this regard, Anne does not make any additional arguments that we have not already addressed; as noted, we perceive no legal error in the court’s findings and conclusions regarding Ed’s gross earning capacity, and no legal

error in the way the court conducted the trial, including specifically its pretrial disclosure order.

¶45 Accordingly, we see no infirmity in the court’s rulings regarding Ed’s gross earning capacity. Its initial findings and conclusions were supported by sufficient evidence, and the court did not err in denying Anne’s motion for a new trial and advising Anne to address the issues raised there, if at all, in the context of a petition to modify the decree.

B. Anne’s Business Expenses

¶46 Anne’s next challenge to the court’s alimony award involves one aspect of its ruling regarding her own earning capacity. As noted, the court determined that Anne’s gross earning capacity was $3,158.50 per month; it derived that figure by averaging her earnings from 2015 through 2019. The court declined Anne’s invitation to subtract business expenses from that figure, concluding that Anne had “failed to explain which, if any, business expenses claimed on her tax returns are necessary to allow [her clothing enterprise] to operate at a reasonable level.” Anne takes issue with the court’s refusal to subtract her claimed business expenses from her monthly gross income computation.

¶47 Under applicable statutory guidance, when a court is assessing a self-employed person’s gross income, the court shall “subtract[] necessary expenses required for self-employment or business operation from gross receipts.” Utah Code § 78B-12­203(4)(a). However, “[o]nly those expenses necessary to allow the business to operate at a reasonable level may be deducted from gross receipts.” Id. “The person claiming business expenses” bears the burden of proving that the claimed “expenses are necessary to allow the business to operate at a reasonable level.” See Ouk v. Ouk, 2015 UT App 104, ¶ 4, 348 P.3d 751 (quotation simplified). Thus, Anne bore the burden of demonstrating, at trial, that her claimed business expenses were necessary to allow her business to operate at a reasonable level. The trial court concluded that Anne failed to carry that burden.

¶48 At trial, Anne pointed to the “Schedule Cs” on her 2017, 2018, and 2019 tax returns as evidence of her business expenses. There, she claimed expenses for “Office expense,” “Supplies,” “Travel,” and “Utilities,” among other more minor items. The trial court explained its reasoning for rejecting Anne’s claim on these items. With regard to “Office expense,” the court noted that Anne “did not explain what actual and necessary business expense this would entail,” and that Anne had “admitted that she does not have an office outside her home.” With regard to “Utilities,” the court noted that Anne had acknowledged that this expense was simply “personal expenses that she is permitted to write off for tax purposes,” and that Anne was unable, during her trial testimony, to “be certain what her claimed ‘Utilities’ expenses entailed.” And with regard to “Supplies,” the court concluded that the figure Anne listed on her tax returns was confusing, because it was unclear, even after Anne’s trial testimony, whether this figure properly accounted for revenue Anne received from selling some of these supplies “at the end of each season.” Given these evidentiary deficiencies, the court found that Anne “failed to meet her burden to demonstrate that the claimed business expenses are only those necessary to allow her business to operate at a reasonable level.”

¶49 We perceive no infirmity in this determination. Anne offered very little testimony about her business expenses, and she supported that testimony only with her tax returns. In its ruling, the court identified several legitimate concerns about the persuasiveness of the evidence Anne presented, and it determined that Anne had not carried her burden of proof. Trial courts have discretion to credit, or not credit, evidence presented to them. See id. ¶ 14 (stating that “the fact-finder is in the best position to judge the credibility of witnesses and is free to disbelieve their testimony” (quotation simplified)). Thus, under the circumstances of this case, the court did not abuse its discretion by finding that Anne had failed to carry her burden to prove the necessity of her business expenses.

C. Net Income Calculations

¶50      Anne’s next challenge to the alimony award involves the court’s net income calculations. She argues that, in assessing the impact of taxes on gross income, the court “miscalculated” her net income and “treated [her] differently than” it treated Ed.

¶51 Anne provided no testimony or documentary evidence regarding net income. That is, she offered the court no assistance in computing net income from the court’s gross income figures. And neither party hired an accountant or offered testimony from any other financial professional. Given these evidentiary realities, the court noted that it was “difficult to ascertain the amount of tax” Anne “actually pays,” especially given certain then-recent changes in the tax code regarding alimony. In the absence of better evidence, the court simply looked to Anne’s tax returns, which showed that, in 2017, Anne had paid $390.35 per month in combined federal and state taxes. The court then subtracted that number from its monthly gross income finding ($3,158.50), and found that Anne’s monthly net income, for alimony purposes, was $2,768.25. On appeal, Anne does not lodge any specific objection to this methodology at a conceptual level.

¶52      Instead, she complains that the court did not compute her net income in the same way as it computed Ed’s. In this, Anne is correct: the court did compute Ed’s net income in a different way. For Ed, the court simply took his gross income figure and applied a tax rate to it. As noted above, the court found that Ed’s monthly gross earning capacity was $20,452.25. The court simply applied “current tax rates” to that figure, without accounting for any potential tax deductions. Using this methodology, the court computed Ed’s monthly net income as $13,358.32.

¶53 Anne complains that using two different methodologies resulted in potential inequity: by using Anne’s actual “tax paid” figure from years past, the court accounted for any tax deductions she had taken, but by simply applying a tax rate to Ed’s gross income figure, the court did not similarly account for any tax deductions Ed might take in the future and effectively assumed that he wouldn’t take any. We take Anne’s point that, as a general matter and where possible, courts should compute divorcing parties’ net incomes for alimony purposes using the same methodology. But courts in appropriate cases may find it necessary to employ differing methodologies for computing spouses’ respective net incomes, and we cannot say that the court abused its discretion by doing so here.

¶54      In this case, there are differences between Anne’s and Ed’s situations. For starters, Anne did not offer any testimony or evidence regarding how the court should go about calculating her net income, so the court used the information it was given. More specifically, Anne did not provide the court any assistance in navigating the changes to the tax code regarding alimony. And with regard to Ed, the court would have found it difficult to use the “tax paid” figure from past tax returns, given that this figure may have included taxes paid on profit-sharing income, which the court had determined not to include in Ed’s future monthly gross income estimate. And as Ed points out, some of the key tax deductions he would have taken in past years (such as for children) would not be available to him in the future.

¶55 In our view, given the absence of any expert financial testimony, and given the paucity of assistance the parties offered the court in making these calculations, the court in this instance made findings within its discretion and supported by the evidence it was given. While we generally advise trial courts to use mirror-image methodologies to compute parties’ respective net incomes in family law cases, we cannot say that Anne has carried her appellate burden of demonstrating that the court abused its discretion by making the calculations it made.

D. Overall Alimony Computation

¶56 The final challenge Anne raises to the court’s alimony award is a more general one: she questions the formula the court used to arrive at its computation, and specifically challenges the manner in which the court assessed her reasonable monthly expenses. She notes that the court went to the trouble of making a finding regarding the parties’ overall marital standard of living ($15,745.73 per month), but she observes—correctly—that it is “unclear what role the marital standard of living then plays in the [c]ourt’s alimony determination.” And she points out that the court “did not use [this figure] as any sort of ‘baseline.’” It is not entirely clear exactly what Anne believes the court should have done with its $15,745.73 figure, but she complains that the court did not take it—and the marital standard of living—appropriately into account in assessing her expenses, and she laments that the court “based its alimony award wholly on [Anne’s] actual expenses at the time of trial.”

¶57 We see at least two problems with Anne’s argument, one general and one case-specific. At a general level, Anne misunderstands the formula that is to be used to compute alimony awards. As we recently observed, courts should not calculate alimony by simply dividing the couple’s pre-separation expenses in half. See Fox v. Fox, 2022 UT App 88, ¶¶ 18-19, 515 P.3d 481, cert. denied, 525 P.3d 1263 (Utah 2022). Indeed, we noted that “[t]here is usually no need for a trial court to make a separate specific finding regarding the overall ‘marital standard of living’ as measured by the total amount of money spent each month by the couple while they were married.” Id. ¶ 19. Such a finding is typically unnecessary; it is not one of the input variables that a court needs to assess before computing an alimony award.

¶58 In this case, the court did go to the trouble of making a finding about the parties’ monthly expenses prior to separation ($15,745.73). But as Anne points out, the court did not use that figure in its ultimate alimony calculation. In this case (as, we suspect, in most cases), such a finding was not necessary and only served to complicate matters. The court did not need to make this finding at all, and its failure to use the $15,745.73 figure in its alimony calculation was not error.

¶59      To be sure, trial courts may not ignore the marital standard of living when making an alimony award. The pre-separation standard of living must be taken into account, because the primary purpose of alimony is “to get the parties as close as possible to the same standard of living that existed during the marriage.” See Rule v. Rule, 2017 UT App 137, ¶ 14, 402 P.3d 153 (quotation simplified). But the way a court should take that standard into account is by assessing a party’s claimed line-item expenses in light of that standard, and not by making an overall-expenses finding and chopping it in half. See Fox, 2022 UT App 88, ¶¶ 19–21, 24; see also Miner v. Miner, 2021 UT App 77, ¶ 20, 496 P.3d 242 (examining each of the claimed line-item expenses “with the marital standard of living in mind”). To give effect to the marital standard of living, courts should—as a general rule— assess parties’ expenses as of the time of separation and not as of the time of trial. See Rule, 2017 UT App 137, ¶ 16 (cautioning “against determining alimony based upon actual expenses at the time of trial because . . . a party’s current, actual expenses may be necessarily lower than needed to maintain an appropriate standard of living for various reasons, including, possibly, lack of income” (quotation simplified)). But “in appropriate situations with regard to certain line items, a court may apply equitable principles, in its discretion, to base alimony on the standard of living that existed at the time of trial.” See Miner, 2021 UT App 77, ¶ 18 (quotation simplified). To assist with this process, the financial declaration form often used in family law cases—and used in this case—includes two columns for each expense item, one for “current amount” and one for “marital expenses.”

¶60      And this leads us to the case-specific problem with Anne’s argument: Anne provided the court with only time-of-trial expenses, and the court gave Anne credit for more or less everything she asked for on her financial declaration.

¶61      The trial court, after making its superfluous “marital standard of living” finding, then proceeded to use the correct formula to compute Anne’s alimony award. See Fox, 2022 UT App 88, ¶ 20. As relevant here, it correctly assessed “the needs of the parties, in light of their marital standard of living.” See id. (quotation simplified). In assessing Anne’s expenses, the court simply gave Anne everything she asked for—to the dollar—in her most recent financial declaration, with only a few exceptions. The court found that a few of the listed expenses were “post-separation debt for which [Anne] is solely responsible,” and it therefore deducted those expenses from the calculation.7F8 And without being asked to do so, the court added to Anne’s list a line item for health care expenses. With regard to all the rest of Anne’s claimed expenses, the court found that these expenses were “reasonable in light of the marital standard of living.” With these adjustments, and based largely on Anne’s own requests, the court calculated Anne’s reasonable monthly expenses as $6,218.

¶62 We perceive no error in the court’s analysis of Anne’s reasonable expenses. It is significant that Anne did not provide the court, in her financial declaration or in her trial testimony, with any evidence regarding the “marital expenses” amount for her claimed line items. If a party offers into evidence only time-of-trial expense amounts, and does not provide the court with any evidence of pre-separation expenses (to the extent they are different), that party has no right to complain when the court awards the time-of-trial amounts. Any complaint on Anne’s part that the court failed to appropriately take the marital standard of living into account in assessing these expenses rings hollow when Anne herself apparently didn’t take the marital standard of living into account in making her claims, and where the court—more or less—credited Anne with all of the expenses she was claiming.

¶63      We therefore reject all of Anne’s challenges to the court’s alimony award. The court employed the proper formula, and all of its determinations were supported by sufficient evidence and were within the court’s discretion.

8. On appeal, Anne does not take issue with the court’s deduction of these post-separation debts from her expenses.

II. Offsets

¶64      The only non-alimony argument Anne raises concerns the court’s rulings regarding the parties’ claimed offsets. During trial, both parties claimed that they should each receive credits, or “offsets,” for purchases made using their personal funds that they believed both parties should be equally responsible for. Ed sought reimbursement of payments he made for maintenance of the marital home and for certain child-related expenses. For her part, Anne sought repayment of other child-related expenses and of costs incurred in moving out of the marital home, and she sought equalization for various other instances where she alleged Ed had used her personal funds. In its post-trial ruling, the court granted Ed’s requests for offsets, but declined to grant Anne’s requests. The court determined that Anne’s requests were “not credible and not proven” because Anne “failed to provide credible and sufficient proof” supporting her claims. The court also concluded that Anne’s requests for offsets had not been timely asserted because they were “first mentioned in her Trial Brief (filed five days before trial)” and therefore Ed had been deprived of any opportunity to “conduct discovery on these requested offsets.”

¶65      Anne contends that the court should not have denied her requests and granted Ed’s, and again complains that the court treated her differently than it treated Ed. She directs much of her appellate ire at the court’s secondary reason for its ruling—that Anne’s requests were not timely made—and asserts that Ed’s requests suffered from the same infirmity. While the court did note that Anne did not timely disclose her offset requests, we do not perceive that as the primary basis for the court’s denial of her requests. Rather, the court’s main concern was that Anne had not carried her burden of proving her requested offsets. By contrast, the court determined that Ed had proven his requested offsets, and that he had done so through a spreadsheet exhibit and “credible” testimony.

¶66 On appeal, Anne does little to engage with the court’s conclusion that her claims—unlike Ed’s—were “not credible and not proven.” Rather, Anne lists the offset awards and denials that she disagrees with, and she offers her view that the rulings were in error. She makes conclusory statements about who paid certain expenses, without proper record citations for those propositions. And for several of the offsets awarded to Ed, Anne claims that there was insufficient evidence, but she does not explain how or why Ed’s spreadsheet exhibit, coupled with his testimony that the court found credible, does not constitute sufficient evidence.

¶67      “An appellant bears the burden of persuasion on appeal, and this burden includes engaging with and responding to the grounds for the decision the appellant is challenging on appeal.” In re A.B., 2022 UT 39, ¶ 39, 523 P.3d 168 (quotation simplified). In this case, Anne has not carried her appellate burden of demonstrating that the court erred in its offset determinations.

CONCLUSION

¶68 The trial court’s post-trial findings and conclusions regarding alimony and offsets were all supported by sufficient evidence and were not an abuse of its discretion. And the court did not err in denying Anne’s motion for a new trial. For all of these reasons, we reject Anne’s appellate challenges.

¶69 Affirmed

 

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