Determining Child Support When a Parent Is an ‘Extraordinarily High Earner"

Posted by George L. FernandezAug 18, 20230 Comments

Tom Cruise pays Katie Holmes $33,000 a month in child support for their daughter, Suri. Kanye West pays Kim Kardashian $200,000 a month for their four children. It's hard for most of us to imagine how these sums are needed to address a child's day-to-day basic needs. But the public policy related to child support is also meant to equalize the standard of living in both parent's homes, and that's where things can get a little crazy. Think: bodyguards, 24-hour nannies, private chefs, and private jets to effectuate timesharing with parents traveling all over the world.

California's statewide uniform guideline child support formula is designed to provide an appropriate amount of child support to a parent, and for the vast majority of parents who are divorced or separated, that is the case. Estimates put the average support paid for one child in California between $500 and $800 per month. The amount established under California's child support formula is rebuttably presumed to be correct (Fam. Code, § 4057, subd. (a)).

When one parent is earning astronomical sums of money -- by some estimates, West earns over $200 million per year -- use of the formula may not be appropriate. One situation in which the presumption may be rebutted is when a supporting parent has an "extraordinarily high income and the amount determined under the formula would exceed the needs of the children" (Fam. Code, § 4057, subd. (b)(3)).

And because children are entitled to the standard of living attainable by the parents' income, the "needs" of a child of extraordinarily wealthy parents will exceed the bare necessities of life. (Marriage of Macilwaine (2018) 26 Cal.App.5th 514.) In cases in which child support is paid by an extraordinarily high earner, it may not be appropriate to define the children's needs by their expenses. (See Marriage of Cheriton (2001) 92 Cal.App.4th 269.)

Burden of proof. When the extraordinarily high-earning supporting parent seeks a downward departure from a presumptively correct guideline amount, that parent bears the burden to establish that application of the formula would be unjust or inappropriate and the lower award would be consistent with the child's best interests. (Marriage of Hubner (2001) 94 Cal.App.4th 175.)

Dodging discovery. Some extraordinarily high earners are not in a hurry to disclose all the faces of their finances in a family law matter. It has been held that, despite the statewide uniform guidelines, when a child support payor who is an extraordinarily high earner stipulates that he or she can and will pay any reasonable amount of child support, the court need not calculate the support amount under the guideline formula. (Estevez v. Superior Court (1994) 22 Cal.App.4th 423.)

The Estevez court indicated, however, that when a high-earning payor resists detailed discovery of his or her financial affairs, the trial court may make such assumptions concerning his or her gross and net disposable incomes as are least beneficial to the payor, and thereby satisfy the requirements of Family Code section 4056.

When the amount of child support is in dispute, however, a trial court must be presented with sufficient information on which to assess a child's needs, and that information includes the amount of the supporting parent's actual income. (Marriage of Hubner (2001) 94 Cal.App.4th 175.) Accordingly, if the payee does not have enough information to enable the trial court to make the assumptions permitted by Estevez, the court should permit limited discovery of the payor's income from which the least beneficial assumptions about that income may reasonably be made. (Johnson v. Superior Court (1998) 66 Cal.App.4th 68.)

As with many issues in family law, there's no bright-line rule here as to what constitutes “extraordinarily high” income. At least the clients who must litigate this issue can afford to do so.