Facts: Husband and Wife divorced after 20 years of marriage.

Throughout the marriage, Husband worked as a physician with board certifications in anesthesiology, internal medicine, and critical care medicine. Wife was mainly a homemaker and stay at home parent for the parties’ children.

Husband usually earned around $600,000 per year.

While the divorce was pending, Husband was asked to leave his position in Tennessee. He accepted a position in Florida that pays him $320,000 a year but provides the opportunity for a bonus of approximately 25%.

Husband also allowed his credentialing and board certifications to lapse.

Husband’s ability to pay alimony was an issue at trial. The trial court concluded that Husband was underemployed and could earn more than he was earning at the time. After finding Husband’s income over 10 years to average $41,000 a month, the trial court found Husband’s earning capacity was $36,000 per month.

Wife was awarded transitional alimony of $9000 a month for six years and $7000 a month thereafter as alimony in futuro.

Husband appealed, arguing the trial court erred by finding him voluntarily underemployed.

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

In Tennessee, the involuntary loss of employment does not preclude the finding of willful or voluntary underemployment. The party’s course of action and decision-making after termination can demonstrate willful and voluntary underemployment.

The Court found no error in the trial court’s analysis:

Here, the trial court was presented with evidence that Husband had allowed certain credentialing and board certifications to lapse, and as noted earlier, the court found that he specifically did so “without taking steps to remedy same such that he could be capable of earning more.” Husband also specifically testified as follows during the trial: “I do not want to work like I was working before.” To be sure, the trial court’s order actually disclaims any expectation that Husband could earn what he earned at the peak of his earnings in 2020 during COVID. Yet, in light of the general testimony from Husband about not wanting to work like before, the concomitant reductions in his earnings as illustrated by the evidence, his past work history and long track record of higher prior earnings, Husband’s allowance of certain credentials and certifications to lapse, the fact that Husband is in his early 50s, and the trial court’s apparent rejection of Husband’s testimony that he could not work clinical hours and had limited opportunities following his employment in [Tennessee], the evidence does not preponderate against the trial court’s determination that Husband is willfully and voluntarily underemployed.

The Court affirmed the trial court’s judgment.

K.O.’s Comment: I find it curious that the trial court awarded six years of transitional alimony (which is generally not modifiable) followed by alimony in futuro (which is modifiable). I welcome your thoughts on why that would be.

Source: Pallekonda v. Pallekonda (Tennessee Court of Appeals, Western, March 7, 2024).

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