Facts: Husband and Wife divorced after nearly 30 years of marriage. At trial, Wife was awarded rehabilitative alimony of $15,000 per month for the first 12 months, $10,000 per month for the next 24 months, and $5,000 per month for the final 24 months. Husband appealed. The Court of Appeals modified Wife’s alimony award from rehabilitative to alimony in futuro, a.k.a. “permanent” alimony, and changed the amount to $9,000 per month. Three years later, Husband petitioned to further modify the alimony award, contending that a substantial and material change of circumstances had occurred that warranted a reduction of his alimony obligation. Specifically, Husband argued his income had decreased dramatically in the three years following the divorce. After a hearing, the trial court found Husband’s income from his medical practice had decreased by one-third and that this constituted a material change. The trial court lowered Husband’s obligation to $5,000 per month. Wife appealed.
On Appeal: The Court of Appeals reversed the trial court.
Wife argued the trial court erred in determining a substantial and material change occurred because the evidence does not support the finding that Husband’s income had decreased.
Alimony may only be modified after a showing of substantial and material change in circumstances since entry of the original support order. A change is considered substantial when it significantly affects either the obligor’s ability to pay or obligee’s need for spousal support. A change is considered material if the change occurred since the original support decree’s entry. Even a substantial and material change of circumstances does not automatically result in a modification. Modification must also be justified under the statutory factors relevant to an initial award of alimony, particularly the receiving spouse’s need and the paying spouse’s ability to pay. Where there has been such a change in circumstances, the ability of the paying spouse to provide support must be given equal consideration to the receiving spouse’s need. The party seeking the modification of alimony bears the burden of proving the modification is justified.
After reviewing the record, the Court found reversible error:
We acknowledge Husband’s argument that income for his solo practice has decreased, and we agree it has decreased; however, it is inappropriate to focus on one source of income when the party has multiple sources of income. For example, Husband’s Schedule E income decreased from 2005, when it was $522,929, to $348,929 in 2009, and the trial court apparently focused on this to support its finding that Husband’s income has decreased. We, however, believe the trial court erred as a matter of law by limiting its examination of Husband’s ability to pay alimony to Husband’s Schedule E income instead of considering Husband’s total income from all sources to determine whether there had been a substantial and material reduction in Husband’s ability to pay alimony.
Specifically citing the deferential standard of review set forth in Gonsewski, the Court reversed the trial court, finding that “the evidence preponderates against the trial court’s finding that Husband’s income or ability to pay alimony has substantially or materially diminished since the award to be modified was established.”
K.O.’s Comment: As this case illustrates, it is possible to get a trial court reversed in a post-Gonsewski world if you successfully argue the evidence preponderates against the trial court’s finding.
Information provided by K.O. Herston: Knoxville, Tennessee Matrimonial, Divorce and Family Law Attorney.