Error to Disregard Alimony Recipient’s Earning Capacity in Memphis, Tennessee Divorce: Pearson v. Pearson

FactsHusband and Wife, the parents of two adult children, divorced after 30 years of marriage.

Husband was the sole financial provider during the marriage. He earned an average of $358,000 a year.

Wife was a stay-at-home mother during the marriage. At the time of the divorce, she was working part-time at Starbucks, earning nine dollars an hour.

math catAfter a three-day trial, the trial court found that Wife, 58, was not capable of rehabilitating her earning capacity, had an earning capacity of $28,000 per year, and needed $9700 per month to sustain a lifestyle similar to that enjoyed during the marriage.

Husband was ordered to pay alimony in futuro of $9700 per month.

Husband appealed.

On AppealThe Court of Appeals reversed the trial court.

To analyze alimony, Tennessee courts must consider the factors found in Tennessee Code Annotated § 36-5-121(i). The two most important factors are the need of the economically disadvantaged spouse and the obligor spouse’s ability to pay.

One of the statutory factors requires Tennessee courts to consider the relative earning capacity of each party when determining the alimony.

The Court held the trial court erred in failing to consider Wife’s earning capacity:

[T]he trial court found that Wife needs $9700 per month to sustain a lifestyle similar to that enjoyed during the marriage. The trial court further found that Wife has an earning capacity of $28,000 per year, or $2333.33 per month. Neither party raises a specific issue concerning this determination. Assuming, therefore, that Wife has a need of $9700 per month and is capable of earning $2333.33, it is clear that the trial court, in charging Husband with $9700 per month in alimony, did not consider Wife’s earning capacity in its calculation.

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The error here is . . . the trial court failed to consider the disadvantaged spouse’s earning capacity. . . . [W]e modify the trial court’s order to reflect a monthly alimony amount of $7366.67, which is the amount of Wife’s need, i.e., $9700 less her monthly earning capacity of $2333.33.

K.O.’s Comment: This holding is consistent with several appellate opinions, including Jeronimus v. Jeronimus, where the Court held “earning capacity figures are used to determine the threshold issues of ability to pay and need.”

Pearson v. Pearson (Tennessee Court of Appeals, Western Section, June 6, 2019).

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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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