Facts: Husband and Wife divorced after 37 years of marriage. The marital estate was equally divided and Wife was awarded alimony in futuro of $10,000 per month.
Five years later, Husband filed a petition to terminate alimony because of his pending retirement from the practice of orthopedic surgery.
By the time of trial, Husband was 65 years old and had officially retired at age 64 after working 35 years as an orthopedic surgeon. Husband testified he suffered from Raynaud’s disease, a disease that prevents blood from flowing into the fingers and toes causing numbness. Husband had difficulty gripping and feeling things. Husband also testified he did not know many orthopedic surgeons practicing beyond the age of 64. Husband said his retirement was in no way motivated by a desire to end Wife’s alimony.
At the time of trial, the parties had a substantially similar net worth of about $3.7 million each.
Wife acknowledged that many of her monthly expenses, such as clothing and gifts for others, had tripled since the time of trial. Although she testified she lives on her alimony, she acknowledged the $3 million she held in liquid assets was enough to support her.
The trial court found there had not been a substantial material change in circumstances. Husband’s petition to terminate alimony was denied.
On Appeal: The Court of Appeals reversed the trial court.
In order to obtain a modification of an alimony award, the party seeking modification must show a substantial and material change of circumstance.
Obligations voluntarily assumed are not proper to be considered as changed circumstances to reduce alimony payments otherwise owed.
When an obligor’s retirement is objectively reasonable, it constitutes a substantial and material change in circumstances — irrespective of whether the retirement was foreseeable or voluntary — so as to permit modification of the support obligation. However, while bona fide retirement after a lifetime spent in the labor force is somewhat of an entitlement, an obligor cannot merely utter the word “retirement” and expect an automatic finding of a substantial and material change in circumstances. Rather, the trial court must examine the totality of the circumstances surrounding the retirement to ensure that it is objectively reasonable. The burden of establishing that the retirement is objectively reasonable is on the party seeking modification of the award.
Even when an obligor is able to establish that a retirement is objectively reasonable, and therefore that it constitutes a substantial and material change in circumstances, the obligor is not necessarily entitled to an automatic reduction or termination of his or her support obligations. The statute permitting modification of alimony awards — Tennessee Code § 36-5-121(a)(2) — contemplates that a trial court has no duty to reduce or terminate an award merely because it finds a substantial and material change in circumstances. Instead, the change in conditions resulting from retirement merely allows the obligor to demonstrate that reduction or termination of the award is appropriate. Accordingly, when assessing the appropriate amount of modification, if any, in the obligor’s alimony payments, the trial court should consider the factors contained in Tennessee Code § 36-5-121(i) to the extent that they may be relevant to the inquiry.
After reviewing the record, the Court ruled:
Husband retired in December 2012 at the age of 64. Husband had been practicing orthopedic surgery for 35 years. The evidence in the record on appeal reveals no motive on the part of Husband to evade his spousal support obligation through retirement. Rather, the evidence overwhelmingly shows that Husband retired on account of growing health problems….
Even setting aside Husband’s health problems, Husband spent over three decades practicing orthopedic surgery. Husband was 64 years old at retirement. It strikes us as quite reasonable that a person in his mid-sixties having performed surgeries for so many years might have an understandable and objectively reasonable desire to retire. When one then factors in the impact of Husband’s significant health problems — including numbness in the hands — on his ability to perform surgeries one cannot help but see potential hazards to his patients in requiring him to carry on performing delicate surgical procedures…. We find and hold that the evidence overwhelmingly supports the finding that Husband’s retirement was objectively reasonable, and that Husband successfully proved a substantial and material change in circumstances. We reverse the Trial Court on this issue….
As stipulated at trial, these parties have a substantially equal net worth of around $3,700,000 each. Husband’s ability to pay has been reduced by his retirement. Meanwhile, Wife’s needs appear to be more than met by her assets. Wife no longer is economically disadvantaged relative to Husband given Husband’s retirement and the parties’ substantially equal significant net worth of roughly $3,700,000 each. Considering all the relevant statutory factors, we find no basis for Husband’s alimony obligation to continue under the evidence contained in the record. These parties are in a roughly equal financial position now, each with significant assets to draw upon sufficient to meet his or her needs. Given the undisputed evidence in the record before us, we find no reason to remand this case for additional hearing, and we terminate the alimony altogether.
Accordingly, Husband’s alimony obligation was terminated as of the date of the Court’s opinion.
Information provided by K.O. Herston: Knoxville, Tennessee Divorce and Family Law Attorney.