Case studies

• Author: Nicholas L. Bourdeau
• Pages: 435-452

22-1

22-1

Chapter 22

Case Studies

TABLE OF CONTENTS

§22:10 NOW YOU HAVE IT, NOW YOU DON’T

FORMS

§22:10 NOW YOU HAVE IT, NOW

YOU DON’T

INTRODUCTION

It was late Friday afternoon, and I was staring

out the window. The fantasies about cold beer and

rare steak had managed to outpace the absurdity

of the week, and it took about everything I had

to keep from bolting out the door. The vision of a

frosty mug was interrupted by my office manager

appearing in my doorway, “Marv Shulke is on the

line. He says he has an interesting case for you.”

Stifling a groan, I swung my feet off my desk.

Marv was a family law attorney, pretty swift, and

not quite burned out. I didn’t mind working with

him, but if he said he had an interesting case, it

usually meant that the case would significantly

shorten my life, earn me enemies, and end badly.

In this, I wasn’t wrong. However, office manag-

ers are expensive to maintain, especially if you’re

married to them. I told her to put the call through.

DCS.indb 1 1/7/2015 9:15:12 AM

§22:10 The Determination of Income for Child Support 22-2

Marv tried to schmooze me a bit, extolling my

virtues, and indicating what a great guy he thought

I was. If I’d had any hair, it would have stood on

end. Marv had a bad one and he knew it. I cut him

off and asked him to run the case. He hesitated a

moment and then began, “Okay, Mom and Dad

married fifteen years; then were separated for two

years before being divorced five years ago. Two

children. Child support has not been determined

since the day of separation.”

Marv stopped, waiting for my reaction. I

didn’t disappoint him. Snarling I asked, “And just

which member of our honorable and esteemed

judiciary failed to establish child support over a

seven-year period?” Marv told me. I reeled a bit.

Judge Pilate understood numbers, family law, and

equity: a rare combination. My sense of dread

deepened. “Marv, the judge couldn’t handle this?”

Marv replied, “It appears that we may have

used up the judge’s patience. The situation is

incredibly complex. Seven or eight hearings on

child support; everyone lost count of the motions

filed; the judge finally divorced them and ordered

us to figure out child support.”

I sighed, “Hence, me.”

Marv said, “Hence you. We need an arbitrator

who can hear both sides of the case and establish

child support for the last seven years.”

I uttered something nasty and Marv said with

a laugh, “I’m glad you’re willing to help.”

I laid down the terms, “I get full and direct

access to the parents. I get everything I ask for.

The attorneys are supplied a preliminary report

with all of the supporting data. You guys have

one opportunity to argue why the preliminary is

wrong; then I issue a final report. I charge my

usual, exorbitant, fees.”

My standard operating procedure in these

cases is to avoid formal hearings and gather infor-

mation directly from the clients. I can gather more

information in two hours on the phone than in four

days of hearings. Besides that, I get to assess rela-

tive levels of insanity.

I started piecing together the picture from con-

versations with the attorneys and the parties. Dad

was a real estate developer and broker. He rode the

inflating balloon of real estate prices, harvesting

profits as it ascended. He dealt in all kinds of prop-

erties but made his serious money in the marketing

of high-end properties. These properties sold for

millions of dollars and involved his receiving a

commission on the sales or actually purchasing the

property and marketing it on his own behalf. When

the real estate bubble burst, Dad went into cham-

pionship denial. He refused to adjust his spending,

take a defensive position, or sell luxury assets. He

was defined by what he owned and wasn’t about

to lose his sense of identity.

Mom, having been trained (by Dad) that the

pool of resources associated with the marriage

was depthless, proceeded to spend money as she

always had. Her first purchase after the divorce

was a vineyard. Apparently, Mom viewed herself

as a wealthy connoisseur of wine who need do

nothing but watch her grapes grow. The multi-

million dollar price tag for the property came

with a nasty little problem which, naturally, was

not disclosed by the seller. An aggressive farm

operation upstream in the aquifer had decided that

crop production was down and applied everything

available to the land to increase productivity.

The resulting chemical cocktail had seeped into

the well source for the vineyard. The tainted

water resulted in a grape crop which produced

an unusual wine; something like a cross between

battery acid and Lysol. The mother promptly sued

the seller of the property and the farm operation.

However, proving the mother’s case and bringing

it to court was expected to take years and hundreds

of thousands of dollars.

The following points of contention were

addressed in the course of reaching a final deter-

mination of child support.

FRAUDULENT TAX RETURNS

As noted throughout this book, parents will

take extraordinary steps in order to avoid paying

the IRS taxes. Many times, these steps cross the

line between “aggressive tax reporting” to outright

theft from the United States Government. The

huge majority of CPAs attempt to keep their

DCS.indb 2 1/7/2015 9:15:12 AM