ROSIAK VS. ROSIAK C/W 86632

Statutes cited

Key holdings

Practitioner summary

**Standard of review.** The court reviews "decisions regarding child support for an abuse of discretion," Romano v. Romano, 138 Nev. 1, 7, 501 P.3d 980, 985 (2022), abrogated in part on other grounds by Killebrew v. State ex rel. Donohue, 139 Nev., Adv. Op. 43, 535 P.3d 1167 (2023); alimony awards for abuse of discretion, Eivazi v. Eivazi, 139 Nev., Adv. Op. 44, 537 P.3d 476, 482 (Ct. App. 2023); and characterization and disposition of property in divorce for abuse of discretion, Williams v. Williams, 120 Nev. 559, 566, 97 P.3d 1124, 1129 (2004); Kogod v. Cioffi-Kogod, 135 Nev. 64, 439 P.3d 397 (2019). An abuse of discretion occurs when a decision is not supported by substantial evidence, Miller v. Miller, 134 Nev. 120, 125, 412 P.3d 1081, 1085 (2018), which is "that which a reasonable mind might accept as adequate to support a conclusion," Finkel v. Cashman Pro., Inc., 128 Nev. 68, 73, 270 P.3d 1259, 1262 (2012). Factual findings are reviewed deferentially and not set aside unless clearly erroneous or unsupported by substantial evidence. Ogawa v. Ogawa, 125 Nev. 660, 668, 221 P.3d 699, 704 (2009). **Gross income.** Applying the invited error doctrine - "a party will not be heard to complain on appeal of error which he himself induced or provoked the court or the opposite party to commit," Pearson v. Pearson, 110 Nev. 293, 297, 871 P.2d 343, 345 (1994) - the court held Richard induced any error in calculating his income by (1) not paying himself a salary, (2) not keeping adequate records, and (3) failing to adequately explain the records he did provide, including violating NRCP 16.2(c)(1), (2), and (d)(1), (2) and (3) by failing to attach supporting documentation to his FDFs. Regardless, substantial evidence (the gross deposits into the operating fund) supported the $57,438 gross monthly income finding. **Social Security dependent benefit offset.** Under NAC 425.150(2), a court may adjust the child support obligation by subtracting the benefit a child receives; the court noted the regulation is permissive, not mandatory, but that Nevada caselaw indicates a credit should be applied to arrearages when a dependent child receives Social Security benefits, citing Hern v. Erhardt, 113 Nev. 1330, 1335, 948 P.2d 1195, 1198 (1997). Because the district court's order contained no discussion of the effect of the dependent benefits, and because Margarita conceded Richard is entitled to a credit, the court vacated the monthly child support obligation "to the extent it includes the Social Security dependent payment" and remanded for the district court to consider the matter and explain its decision if it declines an offset; if an offset is allowed, overpayments count against arrears. The $63,955 arrears order was necessarily vacated; if no offset is allowed, the monthly support and arrearage orders shall be reinstated with any new arrears added. **Alimony.** Under NRS 125.150(9), the district court must consider 11 enumerated statutory factors plus any other relevant factors; alimony may also compensate for loss of the marital standard of living, Kogod, 135 Nev. at 69, 439 P.3d at 403. The district court's findings - a 21-year marriage, Margarita's need for support, her curtailed higher education based on Richard's advice and preferences, her $35,000 counselor salary versus Richard's understated FDF figure of $200,340 gross annual income - were supported by substantial evidence, and the $202,500 lump sum award ($2,250/month for 7.5 years) was affirmed. **Unequal property and debt division.** NRS 125.150(1)(b) permits unequal distribution "as it deems just if the court finds a compelling reason to do so and sets forth in writing the reasons for making the unequal disposition"; NRS 125.150(2) governs reimbursement of separate property contributions to joint property; and "separate property placed into joint tenancy is presumed to be a gift to the community unless the presumption is overcome by clear and convincing evidence," Schmanski v. Schmanski, 115 Nev. 247, 249, 984 P.2d 752, 754 (1999). The district court's written findings - including that "Richard's commingling, non-existent record keeping, overreaching and undue influence are all justification for making an unequal distribution of property" - were supported by the record and bolstered by the credibility finding against Richard. However, because both parties cannot each be 100 percent responsible for the same 9917 Wiley Burke debt absent a joint-responsibility finding, that portion was vacated and remanded for correction of an apparent clerical error. See NRCP 60(a). **Law firm valuation.** Where separate property increases in value during marriage from both investment and the parties' labor and skill, the increase is apportioned between separate and community property, Johnson v. Johnson, 89 Nev. 244, 246, 510 P.2d 625, 626 (1973), under the Pereira (Pereira v. Pereira, 103 P. 488 (Cal. 1909)) or Van Camp (Van Camp v. Van Camp, 199 P. 885 (Cal. Dist. Ct. App. 1921)) analysis; Pereira "appears to be the preferred method," instructing courts "to allocate a fair return on the investment to the separate property and to allocate any excess to the community property," Cord v. Neuhoff, 94 Nev. 21, 26, 573 P.2d 1170, 1174 (1978). The district court's valuation of the firm at 65% of gross annual deposits ($448,022), awarding Margarita $224,011, was affirmed: Richard invited any error by failing to provide the disclosures required by NRCP 16.2(d)(3)(L) and (M), and substantial evidence supported the result. **9917 Wiley Burke and separate-property reimbursement.** Richard's challenges to the award of 9917 Wiley Burke and the denial of reimbursement for alleged separate property contributions to the Las Vegas properties failed under Pearson's invited error doctrine and the commingling principles of Ormachea v. Ormachea, 67 Nev. 273, 297, 217 P.2d 355, 367 (1950) ("[I]ntermingled properties are considered community properties.") and Lucini v. Lucini, 97 Nev. 213, 215, 626 P.2d 269, 271 (1981) (burden on party asserting commingled property remained separate). A footnote notes the community property presumption from Lopez v. Lopez, 139 Nev., Adv. Op. 54, 541 P.3d 117, 125 (Ct. App. 2023), and that spousal earnings are community funds, Robison v. Robison, 100 Nev. 668, 670, 691 P.2d 451, 453 (1984). Arguments unsupported by record citations were declined under Edwards v. Emperor's Garden Rest., 122 Nev. 317, 330 n.38, 130 P.3d 1280, 1288 n.38 (2006), and NRAP 28(a)(10)(A). **Tax debt.** Richard invited any error in being held solely responsible for the tax debt by choosing not to file federal and state tax returns and not hiring a financial expert. In a footnote, the court added that hiding community assets, refusing to provide financial information, and being untruthful about income are compelling reasons for unequal distribution, see NRS 125.150(1)(b); Putterman v. Putterman, 113 Nev. 606, 609, 939 P.2d 1047, 1049 (1997), and that a discovery-based sanction of this type is specifically allowed, see NRCP 16.2(h)(3). **Attorney fees.** Because portions of the judgment supporting the fee award (entered under NRS 18.010(2)(b) and EDCR 5.219) were vacated and Margarita "may no longer be considered the only prevailing party," the fee award was necessarily vacated. See Iliescu v. Reg'l Transp. Comm'n of Washoe Cnty., 138 Nev., Adv. Op. 72, 522 P.3d 453, 462 (Ct. App. 2022). A footnote reminds the district court that it must make more than conclusory legal findings regarding the basis for awarding attorney fees, citing Stubbs v. Strickland, 129 Nev. 146, 152 n.1, 297 P.3d 326, 330 n.1 (2013).

In plain language

Richard and Margarita Rosiak married in 2000 and divorced after Margarita filed for divorce in Nevada in 2018. Richard, an attorney, ran his own law firm; Margarita worked for him as his only employee, and, according to the district court's findings, went unpaid for roughly 20 years. Throughout the marriage, everything - law firm income, rent from properties, and all personal and business expenses - flowed through one account: the law firm's operating fund. Richard never paid himself a salary, stopped filing tax returns in 2015, and kept essentially no financial records. The couple also owned multiple properties in California and Las Vegas, plus a house at 9917 Wiley Burke that had a complicated ownership history involving Margarita's family. After trial, the district court found Richard was not credible and had made multiple material misrepresentations. Because he provided no documents to support the income figure on his financial disclosure form, the court calculated his gross monthly income at $57,438 based on deposits into the law firm operating fund, and ordered him to pay $3,178 in monthly child support. It also awarded Margarita $202,500 in lump sum alimony, gave her a $224,011 share of the law firm's value, divided the couple's property unequally (Margarita received $3,040,889 in assets and $218,228 in debt; Richard received $8,764,891 in assets and $1,491,647.09 in debt), made Richard solely responsible for at least $204,805 in tax liability, found Richard owed $63,955 in child support arrears, and awarded Margarita attorney fees. On appeal, the Nevada Court of Appeals affirmed almost all of these rulings. A recurring theme was the "invited error" doctrine - the principle that a party cannot complain on appeal about a problem he himself created. Because Richard commingled all money in one account, kept no adequate records, paid no salaries, stopped filing tax returns, and hired no accountant or expert, the court held he could not now fault the district court for working with the only evidence available: the gross deposits into his firm's account. The appellate court did, however, send three related issues back to the district court. First, Richard receives Social Security benefits, and his minor child K.R. receives a dependent benefit that Margarita now collects directly. Margarita conceded on appeal that Richard should get a credit against his child support for that benefit. The court therefore vacated the monthly child support order only as to the Social Security dependent payment and sent the issue back for the district court to consider an offset (and to explain its decision if it declines one). Second, because that offset could change the arrears calculation, the court also vacated the $63,955 arrears order. Third, because parts of the judgment supporting the attorney fee award were vacated, the fee award was vacated too. Separately, the court vacated a portion of the order that made both spouses each 100 percent responsible for the same debt on 9917 Wiley Burke - which the court described as what "appears to be a clerical error" - and remanded for correction.