               REPORTED

IN THE COURT OF SPECIAL APPEALS

              OF MARYLAND

                No. 1011

          September Term, 20




        JOHN LEINEWEBER


                   v.


      MICHELE LEINEWEBER




  Zarnoch,
  Wright,
  Nazarian,

                        JJ.


         Opinion by Wright, J.

        Filed: October 29, 2014
       Appellant/Cross-Appellee, John Leineweber (“Father”), and Appellee/Cross-

Appellant, Michele Leineweber (“Mother”), were divorced in the Circuit Court for

Howard County on April 4, 2005. The Judgment of Absolute Divorce granted the parties

joint legal custody of their minor children with Mother having primary physical custody.

Pursuant to a Mediated Settlement Agreement (“Agreement”), that was incorporated in

the Judgment but not merged, Father agreed to “pay to [Mother] the sum of $2,199.00,

per month, as and for child support.”

       On April 29, 2011, Mother filed a motion to modify custody and child support,

which Father moved to dismiss. After hearing the matter on November 30, 2011, the

Master in Chancery issued a written report and recommendation to which neither party

filed exceptions. On January 3, 2012, the circuit court granted Mother’s motion and

ordered Father to pay Mother $13,263.00 per month in child support effective December

1, 2011, $14,336.54 for child support-related reimbursements, $110,156.00 for child

support arrears, and $43,704.27 for counsel fees.

       On October 31, 2012, Father filed a complaint to modify child support which

Mother moved to strike. After hearing the matter on April 30, 2013, the Master

recommended that the circuit court deny Father’s request for modification. On May 9,

2013, Father filed exceptions arguing in pertinent part that “although the Master

determined that [Father’s] previous deferrals were counted as income in the year in which

they were earned . . . and [Father] introduced sufficient evidence to identify the amounts

which were previously deferred, the Master failed to take into consideration the evidence
presented in reaching her recommendation.” On July 3, 2013, the court held a hearing on

Father’s exceptions and, thereafter, denied Father’s request for modification of child

support. On July 31, 2013, Father timely appealed. He asks us to determine whether the

circuit court abused its discretion in denying his motion to modify child support.1

       On May 16, 2013, prior to the exceptions hearing, Mother filed a motion for

counsel fees and costs with request for a hearing, which the circuit court summarily

denied on August 26, 2013. On September 4, 2013, Mother filed a motion for

reconsideration, which the court also summarily denied on October 15, 2013. Thereafter,

Mother noted a cross-appeal wherein she asks us to determine whether “the trial court

err[ed] in failing to conduct an evidentiary hearing on [her] claim for an award of counsel

and experts [sic] fees and court costs.”

       For the reasons that follow, we affirm the circuit court’s judgments.

                                             Facts

       The parties were married on October 21, 1995, in Baltimore, Maryland, and had

two children, Emory and Peyton. At all times of the proceedings in this case, Father

worked as an employee of Jones Lang LaSalle, Inc. In 2004, the parties entered into an




       1
           In his brief, Father worded his question as follows:

       Where deferred income was included in the calculation of child support in
       the years in which it was earned, and payments were made on that
       calculation, when calculating a modification of that award, is it proper for
       the Court to include that same deferred income again in the years paid?

                                                2
Agreement, which was incorporated but not merged into the Judgment of Absolute

Divorce. The Agreement provided, in pertinent part:

       4.     CHILD SUPPORT

       A.     Commencing April 1, 2004 or the date on which this Agreement is
       signed, whichever later occurs, [Father] shall pay directly to [Mother], for
       the support and maintenance of the Children, the sum of Two Thousand
       One Hundred Ninety Nine Dollars ($2,199) per month, payable on the first
       day of each month . . . .

               The parties have agreed to the amount of child support payments set
       forth above in consideration of each party’s rights and benefits under this
       Agreement, and with due regard for the child support guidelines currently in
       effect in Maryland. The parties have based this calculation on the following
       information: [Father’s] gross annual income is $150,000; [Mother’s] gross
       annual income is $75,000 . . . .
                                          * * *
       D.      The parties agree that the child support shall be recalculated on April
       15th 2006 and that they will recalculate the child support every two years
       thereafter. The parties shall exchange his and her income tax forms with
       the other party on or before April 15th of the recalculation year, the child
       support shall be calculated in accordance with the then current gross
       incomes of the parties and the child support guidelines in effect at that time.
       The new child support figure shall be payable as of May 1st of the
       recalculation year. In addition, if either party has an involuntary twenty five
       percent (25%) increase or decrease in gross income, the child support shall
       be recalculated as of the date of such involuntary increase or decrease and
       the new child support amount shall be due and payable as of the first day of
       the month immediately following the effective date of such increase or
       decrease[.]

       In 2011, Mother filed a motion to modify custody and child support which the

circuit court granted. In ordering the modification, the court adopted the Master’s

recommendations, which were based on the following factual findings:

       33. At the time of the parties’ meeting in April 2006, based on the

                                              3
       documentation produced by Father, the parties agreed that Father’s total
       income for the year would be $144,000. This figure represented the
       $125,000 in wages, a projected $15,000 bonus, and some other miscellany.
       It was not an accurate expression of Father’s gross income, and the [M]aster
       finds that Father was aware of this inaccuracy and that it was intended by
       Father to mislead Mother for the purpose of reducing his child support
       obligation.
                                         * * *
       44. At no time did Father ever disclose to Mother that his income had
       dramatically increased from the time child support was originally set. The
       evidence presented by Father shows the following income: 2004: $150,000;
       2005: $291,125; 2006[:] $402,791; 2007: $356,434; 2008: $392,796; 2009:
       $422,060; 2010: $626,570; and 2011 (as of October): $838,426.

       45. Mother’s income has also increased, but not as dramatically: 2004:
       $68,377; 2005: [$]73,189.61; 2006: $82,577; 2007: $87,567; 2008:
       $90,486; 2009: $94,134; 2010: $95,831.73; 2011: $108,929 (extrapolated
       from current numbers).

As a result, Father was ordered to pay Mother $13,263.00 per month in child support

effective December 1, 2011, $14,336.54 for child support-related reimbursements,

$110,156.00 for child support arrears, and $43,704.27 for counsel fees. He did not note

an appeal.

       On October 31, 2012, Father filed a complaint to modify child support, alleging

that “there has been a material change in circumstances” in that his “income has

substantially decreased.” In support of his allegation, Father averred:

       6. That, at or about the time in the Court’s Order, the Court utilized the
       sum of Eight Hundred Thirty Eight Thousand Four Hundred Twenty Six
       Dollars and Two Cents ($838,426.02) as 2011 income for [Father].

       7. That that figure consisted of, inter alia, a base salary of Two Hundred
       Five Thousand Dollars ($205,000.00), a bonus of Four Hundred Sixty
       Seven Thousand One Hundred Twenty Three Dollars ($467,123.00), and

                                             4
       [Share Option Plans] vesting of $162,573.20.
                                         * * *
       10. That since the aforesaid Hearing, [Father] has received his bonus for
       2011 received in 2012 in the amount of One Hundred Thirty One Thousand
       Six Hundred Forty Three Dollars and Seventy Five Cents ($131,643.75),
       representing a substantial decrease . . . .

       11. That, in addition, [Father] has available to him, through his employer, a
       deferred compensation plan that provides him with the opportunity to defer
       income on an annual basis . . . .

       12. That, although documentation of current income will appear to be
       significantly higher than set forth herein, those figures that contribute to the
       W-2 and paystub numbers are in fact the result of compensation previously
       deferred.

       13. That, although it may appear that those figures should be considered for
       purposes of determining current child support, the Court has already
       considered those deferred compensation figures . . . .

       14. . . . The income for Defendant is now Four Hundred Thousand Nine
       Hundred Thirty One Dollars and Sixty Cents ($400,931.60).
                                         * * *
       17. That, as of January 1, 2012, [Father’s] income decreased by more than
       twenty five percent (25%) from his 2011 income figure utilized by the
       Court to calculate his 2011 child support obligation.

Thus, Father asked the court to “modify his child support retroactive to January 1, 2012.”

       After hearing the matter on April 30, 2013, the Master recommended that the

circuit court deny Father’s motion based, in relevant part, on the following factual

findings, to which Father subsequently excepted:

       37. The [M]aster did not agree with [the] analysis [of Mother’s accounting
       expert, that the deferred monies should be treated as income both in the year
       it was deferred, and in the year it was paid]. In this particular case, the
       previous deferrals were counted as income in the year in which they were
       earned for child support. Only the growth on the deferrals can be attributed

                                              5
       as income to avoid the “double dipping.” However, comparing the numbers
       from the [W-2s] and the amounts on the deferred compensation it is not
       possible to know how much is attributable to actual contribution to the
       deferred compensation plans and the amount of gain that money earned
       prior to distribution.
                                          * * *
       48. The burden is clearly on [Father] to prove the material change in
       circumstances in order to merit a modification of child support. [Father]
       presented numerous documents and reports to demonstrate his income.
       Clearly his 2012 bonus income is lower than his 2011 bonus income. The
       dispute between the parties surrounds the treatment of [Father’s] receipt in
       2012 of the $396,164.24 deferred compensation for child support purposes.
       If it is not included in income, [Father] is entitled to a modification of child
       support. If it is included in income, or if a sufficient portion is included in
       income, [Father] would not be entitled to a modification. The problem is
       one of proof. The [M]aster finds that amounts actually deferred in prior
       child support years should not be included in income in determining child
       support in future years to the extent that the deferred monies are being paid
       out to [Father]. However, [Father] has failed to prove how much of that
       money was actually counted before as his income for the purposes of child
       support. Since the burden of production rested with [Father], his failure to
       bring proof from which this court can determine his 2012 income is a fatal
       flaw i[n] his case for modification, and it must fail.

In his exceptions, Father argued that he “produced sufficient evidence for the Master to

accurately segregate the amounts deferred from [his] income from the gains and losses

which those amounts earned prior to distribution.” According to Father, the evidence that

he presented “reflects that the sum of $396,164.24 is comprised of income which [he]

previously deferred from (1) his 2005 bonus (paid in 2006), (2) his 2007 base salary, and

(3) his 2007 bonus (paid in 2008).” Specifically, Father noted that evidence was

presented to show that he “deferred one hundred percent (100%) of his 2005 bonus,

twenty five percent (25%) of his 2007 base salary, and seventy five percent of his 2007



                                              6
bonus.” Therefore, he urged the circuit court not to include the sum of $396,164.24 in his

2012 income for the purposes of determining child support.

      After holding a hearing on Father’s exceptions on July 3, 2013, the circuit court

ruled from the bench as follows:

              I find that that was an appropriate position for the Master to take [to
      include the $396,164.24 in calculating Father’s income because there was
      no evidence to distinguish what portion of it was a gain on the original
      deferred income]. And, quite frankly, even perhaps more, I guess I should
      say that I agree with the Master beyond that because I think it results in the
      same conclusion that that $396,164.24 was income for 2012. And whether
      it was or was not properly included as income when it was deferred is not
      entirely clear from the record. But, if it was inappropriately included at the
      time it was originally calculated as income when it was, in fact, deferred is
      sort of ancient history. My position would be that it was, in fact, income for
      the year 2012, which was the important time frame for purposes of these
      calculations.

               And so, I agree with the Master, perhaps, for a slightly different
      reason. I feel like the inclusion of the deferred income at the - - in the past
      may have been a mistake. That the parties did not take exception to or
      appeal from . . . that’s res judicata. That’s water under the bridge. But, for
      purposes of 2012, what is appropriately income, I find that that
      [$396,164.24] was appropriately considered in those calculations because it
      was, in fact, income for 2012.
                                          * * *
      . . . So, with that the [Father] does not meet his burden of demonstrating a
      25% reduction. I’m sorry if that does result in double dipping. As a
      practical matter maybe it did, but the calculations for 2012, as far as I’m
      concerned, are correct.

Additional facts will be included as they become relevant to our discussion, below.




                                             7
                                         Discussion

I.     Child Support

       Father argues that the circuit court erred in denying his request for modification of

child support because he met his burden of proving that he suffered a decrease in income

of at least 25 percent.2 Specifically, Father contends that “deferred income, which was

attributed to a parent in the years it was earned for purposes of calculating child support .

. . should not be counted a second time,” as the court “recognized,” that it did here.

Father further asserts that he met his burden by establishing that the entire $396,164.24 in

deferred income “had been included in the prior award.”

       In response, Mother argues that the circuit court’s judgment should be affirmed

because Father failed “to meet his burden of proof that he incurred a 25% decrease in his

income to warrant a modification of his child support obligation.” Mother notes that the

Master only recalculated child support based on Father’s income in 2005, 2006, 2010, and

2011, but that deferred monies were also deposited in 2007 and 2008, and Father failed

“to show what portion of those deferred funds were actually used . . . during th[e]

recalculation years.” Mother also urges us to uphold the circuit court’s conclusion that

deferred income “should be calculated when it is first received, whether deferred or not,

and income again in the year it is actually received.”



       2
         To be clear, Father does not challenge the circuit court’s January 3, 2012 order,
which directed him to pay Mother child support reimbursements, arrears, and counsel
fees, in addition to modifying child support.

                                              8
       We agree with Father that deferred income, which has been attributed to a parent

in the years it was earned for purposes of calculating child support, should not be counted

a second time when that parent actually receives it. Nonetheless, we uphold the circuit

court’s denial of Father’s motion for modification because our review of the record

reveals that Father failed to show that the $396,164.24 in deferred income had been

included in the circuit court’s prior calculations of child support. As such, Father failed

to meet his burden of proving that he has suffered at least a 25 percent decrease in

income.

       Pursuant to Md. Code (1984, 2012 Repl. Vol.), § 12-104(a) of the Family Law

Article (“FL”), a court “may modify a child support award subsequent to the filing of a

motion for modification and upon a showing of a material change of circumstance.” See

also Ley v. Forman, 144 Md. App. 658, 665 (2002) (“When presented with a motion to

modify child support, a trial court may modify a party’s child support obligation if a

material change in circumstances has occurred which justifies a modification.”). “[A]

material change in circumstances may be based . . . on a change in . . . the parents’ ability

to provide support.” Smith v. Freeman, 149 Md. App. 1, 20-21 (2002) (citations and

emphasis omitted).

       In cases such as this, where a Master submits a proposed order to the circuit court,

exceptions to the recommendation “warrant an independent consideration by the trial

court.” Kierein v. Kierein, 115 Md. App. 448, 453 (1997). “The trial court ‘should defer



                                              9
to the fact-finding of the master where the fact-finding is supported by credible evidence,

and is not, therefore, clearly erroneous.’” Id. (quoting Wenger v. Wenger, 42 Md. App.

596, 602 (1979)). “[W]hen faced with exceptions to the master’s findings of fact, the trial

court must exercise its independent judgment, consider the allegations, and decide each

such question.” Id. at 454 (citation and footnote omitted). Further, “[t]he judge should,

in an oral or written opinion, state how he resolved those challenges.” Id. (citation

omitted). Ultimately, “[w]hether to grant a modification rests with the sound discretion of

the trial court and will not be disturbed unless that discretion was arbitrarily used or the

judgment was clearly wrong.” Ley, 144 Md. App. at 665 (citing Dunlap v. Fiorenza, 128

Md. App. 357, 363 (1999)).

       In this case, both parties agree that there is presently no Maryland authority that

addresses the issue of whether deferred income, which was attributed to a parent in the

years that it was earned for purposes of calculating child support, can be counted again as

“income” in the year actually received when recalculating child support. FL § 12-201(h)

defines “[i]ncome” as “actual income of a parent, if the parent is employed to full

capacity[.]” In turn, “‘[a]ctual income’ means income from any source.” FL §

12-201(b)(1). Meanwhile, “‘[a]djusted actual income’ means actual income minus . . .

preexisting reasonable child support obligations actually paid.” FL § 12-201(c)(1).

       As Father notes in his brief, the Supreme Court of Alaska was faced with a similar

issue in Bergstrom v. Lindback, 779 P.2d 1235, 1237 (Alaska 1989), where the Court



                                              10
addressed Alaska’s Civil Rule 90.3(a)(1), which “defines income as the parent’s ‘total

income from all sources.’” The Bergstrom Court reasoned:

       Given this broad definition, we believe that the superior court has discretion
       whether to include in income amounts voluntarily deposited into deferred
       income compensation accounts. Under this rule, the court will be able to
       prevent a parent from decreasing his or her child support obligation by
       shifting income earned presently into the future.

Id. at 1237 (internal citation omitted) (emphasis added).3 See also Murray v. Murray, 716

N.E.2d 288, 293 (Ohio Ct. App. 1999) (noting that “the income should be imputed . . . to

prevent a parent from avoiding child support obligations by shifting present income to a

cash flow expected to be enjoyed at some future time, when the children have become

emancipated[,]” and that “[a] choice to defer income will not justify deferring or avoiding

child support”) (citations omitted); Jones v. Jones, 883 So. 2d 207, 211 (Ala. Civ. App.

2003) (“allowing a parent to exclude deferred income from calculations of child support

income on which taxes have been deferred could frustrate the legitimate purpose of the

support orders; it would permit a parent charged with a duty of support to lower the



       3
           In Bergstrom, the Court went on to conclude:

       [O]nce the court decides to include deferred compensation in the child
       support calculus, logic dictates that the court also reduce the resulting
       annual income by the income taxes which would have been paid had the
       deferred compensation been included in that year’s income for tax purposes.
       This corollary prevents an obligor parent who defers present income from
       being saddled with a child support obligation greater than that which would
       have resulted had the parent not deferred income at all.

Bergstrom, 779 P.2d at 1237.

                                             11
amount that would be subject to a support order.”) (Quoting Ennis v. Venable, 689 So. 2d

165, 166 (Ala. Civ. App. 1996)).

       Applying the same reasoning here, if we adopt the circuit court’s belief that

deferred income should be included only when the non-custodial parent actually receives

the money, then that parent would be able to decrease his or her child support obligation

by shifting income earned presently into the future. Therefore, we agree with Father’s

assertion that deferred income should be included in the child support calculation only

during the year that it was earned and not during the year that it is actually received.

       Having determined the applicable law, we turn to look at whether the circuit court

abused its discretion in concluding that Father failed to meet his burden of demonstrating

a 25 percent reduction in income. Specifically, we look to see whether Father proved that

his deferred income of $396,164.24 was included in the previous child support

calculations, thus warranting its removal from Father’s present income. Compare Grams

v. Grams, 624 N.W.2d 42 (Neb. Ct. App.) (2001) (concluding that inclusion of deferred

income for purposes of calculating child support was inappropriate where the trial court

used taxable income from prior years to calculate support) with Hinkle v. Hinkle, 685

A.2d 175 (Pa. Super. Ct.) (1996) (indicating that deferred income received by obligor in

year of modification could be considered when modifying child support obligation, absent

showing that the deferred income was considered when setting the amount of prior

support payments).



                                              12
       When Father filed his exceptions to the Master’s recommendations, he attached as

an exhibit a “Benefit Statement for the Period December 1, 2011 - March 31, 2013,”

detailing his “Deferred Compensation Plan.” Under the heading “Account Balance by

Plan Year & Deferral Source,” the document indicates that $396,164.24 was distributed

to Father from his 2005 and 2007 Plan Year deferrals. The document also states that

Father had $401,491.90 in “Deferrals to Date,” which it defined as “the total

contributions by deferral source for each Plan year from inception to the end of the

statement period.” Therefore, based on this exhibit, Father provided proof that he had

deferred at least $401,491.90, from which he cashed out the $396,164.24 that is presently

at issue.

       What Father failed to prove, however, is that the circuit court, in recalculating his

child support and arrears in January 2012, included the $396,164.24 in its calculations.

When Father filed his motion to modify child support, the only documents he attached

were: (1) the parties’ Agreement; (2) their W-2s from 2005 to 2010; (3) documents

detailing their insurance and childcare expenses; (4) a list of their annual and monthly

incomes from 2004 to 2011; and (5) the Master’s child support worksheets which were

used in recalculating child support. None of these documents address the specific issue of

whether Father’s annual income included the deferrals for all the years in question.

Accordingly, we cannot, nor could the circuit court, discern what portion of Father’s

“annual income” could be attributed to his deferred income. Because Father failed to



                                             13
provide evidence that the $396,164.24 in deferred income was actually used by the

Master in her 2012 calculations, we cannot give him the benefit of reducing his present

income by that amount.

       As Father failed to meet his burden of proof, we affirm the circuit court’s denial of

his motion to modify child support. See Robeson v. State, 285 Md. 498, 502 (1979) (“a

trial court’s decision may be correct although for a different reason than relied on by that

court.”) (Citations omitted). We and the circuit court get to the same result by a slightly

different pathway.

II.    Attorney’s Fees

       Mother, in her cross-appeal, argues that the circuit court erred in denying her

motion for counsel fees and costs without a hearing because “a trial court must conduct

an evidentiary hearing on the issue of an appropriately filed request for counsel fees and

court costs.” Citing FL § 12-103(b) and Davis v. Petito, 425 Md. 191, 206 (2012),

Mother urges us to remand the case back to the circuit court for an evidentiary hearing on

her motion.

       FL § 12-103, in its entirety, states:

       Award of costs and fees

       (a) The court may award to either party the costs and counsel fees that are
       just and proper under all the circumstances in any case in which a person:

              (1)     applies for a decree or modification of a decree concerning
                      the custody, support, or visitation of a child of the parties; or



                                               14
              (2)     files any form of proceeding:

                      (i) to recover arrearages of child support;

                      (ii) to enforce a decree of child support; or

                      (iii) to enforce a decree of custody or visitation.

       Conditions for award of costs and fees

       (b) Before a court may award costs and counsel fees under this section, the
       court shall consider:

              (1)     the financial status of each party;

              (2)     the needs of each party; and

              (3)     whether there was substantial justification for bringing,
                      maintaining, or defending the proceeding.

       Whom cost and fees awarded to

       (c) Upon a finding by the court that there was an absence of substantial
       justification of a party for prosecuting or defending the proceeding, and
       absent a finding by the court of good cause to the contrary, the court shall
       award to the other party costs and counsel fees.

A plain reading of this statute shows that the court is required to consider the three factors

under FL §12-103(b) “[b]efore [it] award[s] costs and counsel fees,” not before denying a

party’s request for costs and fees. (Emphasis added). See In re Sean M., 430 Md. 695,

703 (2013) (stating that in interpreting statutes, appellate courts first “look[s] to the

normal, plain meaning of the language of the statute”) (citation and internal quotation

mark omitted). Nonetheless, this Court has previously remanded a case “for the trial

court to consider the factors in FL § 12-103 and articulate its basis for denying counsel

                                               15
fees” where the parties had “disparate incomes.” Kierein, 115 Md. App. at 459. This is

because “[t]he standard of review for the award of counsel fees and costs in a domestic

case is that of whether the trial judge abused his discretion in making or denying the

award.” Steinhoff v. Sommerfelt, 144 Md. App. 463, 487 (2002) (citations omitted).

Stated differently, “[a]n award of attorney’s fees will not be reversed unless a court’s

discretion was exercised arbitrarily or the judgment was clearly wrong.” Petrini v.

Petrini, 336 Md. 453, 468 (1994) (citations omitted).

       In this case, however, we need not address Mother’s contention that the circuit

court abused its discretion in not hearing the matter because, as Father notes in his reply

brief, Mother “made no request of the [c]ourt to take evidence on or hear argument on her

Motion” during the exceptions hearing on July 3, 2013. Mother filed her motion for

attorney’s fees 18 days before the hearing, yet she did not raise the issue when the parties

came before the court. As such, she waived her claim. See Davis v. Davis, 335 Md. 699,

722 (1994) (stating that “failure to raise the issue . . . constitutes a waiver of that

allegation of error”).

       For all of the foregoing reasons, we affirm the judgments of the circuit court.

                                             JUDGMENTS OF THE CIRCUIT COURT
                                             FOR HOWARD COUNTY AFFIRMED.
                                             COSTS TO BE DIVIDED EQUALLY
                                             BETWEEN THE PARTIES.




                                               16
