## Facts

- William E. Olmstead and Elizabeth A. Ziegler, both attorneys, married in 1989 and had one child, Lauren (born 1990).
- The parties divorced in December 1994. The decree incorporated a settlement agreement providing joint legal and physical custody.
- The agreement provided that neither parent would pay child support to the other; Olmstead agreed to pay the child’s daycare and educational expenses.
- At the time of divorce, Olmstead reported annual gross income of about $53,000; Ziegler reported about $25,000 (and had earned less than that in 1994).
- After the divorce, Ziegler’s income increased substantially, including after she joined a Juneau law firm.
- Olmstead’s law partnership ended in 1996 after his partner left; evidence suggested the partner left because Olmstead was unproductive and spent work time playing computer card games rather than working on cases.
- Olmstead became a solo practitioner and gradually reduced his workload; his reported income dropped sharply (including to roughly $10,000–$13,000 in later years).
- In March 1999, Olmstead decided to close his law practice, offer only limited legal research and writing services, and return to school to become a teacher.
- By 1999, the child no longer needed regular daycare and attended public school; Olmstead estimated he was paying about $80 per month for child care.
- In June 1999, Olmstead petitioned to modify the child-support arrangement based on his reduced income, stating that he was unsuccessful at practicing law.
- The superior court denied the petition, finding Olmstead was voluntarily underemployed and that his earning capacity had not changed.
- Olmstead appealed; both parties appeared pro se.

## Issues

1. Whether the superior court erred in finding that Olmstead was voluntarily underemployed for purposes of child-support modification.
2. Whether the superior court properly relied on Olmstead’s earning capacity, rather than his reduced actual income, in determining whether modification was warranted.
3. Whether Olmstead showed a material change in circumstances sufficient to justify modifying the parties’ child-support arrangement under Alaska Civil Rule 90.3.

## Decision

- The Supreme Court of Alaska affirmed the superior court’s denial of Olmstead’s motion to modify child support.
- The court held the superior court did not err in finding that Olmstead’s reduced earnings resulted from voluntary underemployment, including his decision to leave legal practice and pursue teaching.
- The court upheld the superior court’s conclusion that Olmstead’s earning capacity had not changed and could be used instead of his self-reduced income when evaluating modification.
- The court determined the superior court’s findings had adequate support in the record and were not clearly erroneous.

## Legal Principles

- A party seeking to modify child support must prove a material change in circumstances under Alaska Civil Rule 90.3.
- When a parent is voluntarily underemployed, a court may impute income and base child-support determinations on earning capacity rather than actual earnings.
- A voluntary career change or intentional reduction in work that lowers income does not, by itself, justify shifting financial responsibility to the other parent.
- Findings on voluntary underemployment and earning capacity are factual determinations reviewed for clear error; the decision to modify support is reviewed with deference to the trial court’s discretion.
- A parent’s professional qualifications and past earnings may support a finding that earning capacity remains intact even when current income has fallen.

## Conclusion

The Alaska Supreme Court affirmed the denial of Olmstead’s modification request because the superior court reasonably found that his income decline stemmed from voluntary underemployment and a personal decision to change careers, not a true loss of earning capacity, so he failed to show a material change in circumstances warranting modification under Rule 90.3.


Olmstead v. Ziegler, 42 P.3d 1102 (2002)