Voluntary Underemployment Affirmed in Clarksville, Tennessee Child Support Modification: Goodrich v. Goodrich

Facts: Father worked in the car sales industry for over 20 years. He began his career by selling cars, eventually working his way up to finance manager. When the parties divorced, he was earning $10,000 per month working for a large, local dealership. The court calculated his child support based upon him earning a gross monthly income of $10,000.

Shortly thereafter, the dealership terminated Father for “poor job performance.”

Father moved to modify his child-support obligation. He alleged that his income was drastically reduced because he lost his job.

After losing his job, Father admitted that his efforts to find a job with another car dealership were limited. Father claimed his health no longer allowed him to work the  necessary hours and that the job placed too much stress on him.

Within a few months of losing his job, Father went to work for a business owned by his parents. He was paid $600 per week. While acknowledging that it paid significantly less than his prior job, Father said it provided much less stress.

Tennessee child support

The trial court found it “problematic” that Father did not seek employment in the field where he worked the majority of his adult life. It also found that Father offered no medical proof to support his claim that he could not resume work as a finance manager for health reasons.

Father was found to be voluntarily underemployed with an earning capacity of $10,000 per month, which amount was imputed to him for child-support purposes.

Father appealed.

On Appeal: The Court of Appeals affirmed the trial court.

Under the Tennessee Child Support Guidelines, a court may set child support based on a parent’s income potential or earning capacity if the court finds that a parent is willfully or voluntarily underemployed. This keeps parents from avoiding their financial responsibility to their children by unreasonably failing to exercise their earning capacity.

Tennessee law does not presume that a parent is willfully underemployed. The trial court must assess the parent’s occupational choices and the reasonableness of those choices, given the parent’s obligation to support his or her children and determine whether those choices benefit the children.

Tennessee courts often begin their analysis with the circumstances under which the parent left his or her previous employment, particularly whether the parting was voluntary. The involuntary loss of a job does not preclude a finding of voluntary underemployment.

Next, the court scrutinizes the parent’s later course of conduct. This scrutiny includes an examination of whether the parent made a good faith effort to replace their lost income. A parent’s course of action and decision-making after losing their job can demonstrate voluntary underemployment.

Father argued it was unreasonable to expect a 43-year-old man “with only a high school diploma to obtain employment with the same or greater salary in a similar position.”

The Court found Father’s arguments unavailing:

When he was terminated, Father was in his early 40s and had at least 16 years of experience as a finance manager. And although he had spent the majority of his career with one dealership group, Father had worked for other dealerships, and he had worked in automobile sales as well as in the finance area. Also of significance, Father could not recall how many resumes he had sent out, only remembering that he had posted resumes on websites. And Father testified that he only spoke on the phone with “some banks” but he never had an interview.

Father also argues that his “occupational choice to not return to the same or similar job was reasonable in light of the long hours, demands of the job, and tremendous stress.” The court deemed it suspicious that Father went to work at his parents’ family business so soon after his termination and that he stayed there despite never receiving a raise in wages. These facts along with Father’s description of his post-termination job search support a finding that Father did not make reasonable choices in light of his obligation to pay child support.

Although Father claims there was no proof that he “acted in bad faith or had deliberately manipulated his income downward,” that level of proof is not required. The court may base its determination on any intentional choice or act that adversely affects a parent’s income.

The trial court’s judgment was affirmed.

Goodrich v. Goodrich (Tennessee Court of Appeals, Middle Section, April 26, 2018).

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K.O. Herston is a family-law attorney in Knoxville, Tennessee whose practice is devoted exclusively to family law, including divorce, child custody, child support, alimony, prenuptial agreements, and other aspects of family law.

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