Recent Case Highlights Differences Between Alimony In Futuro vs. Alimony In Solido in Tennessee

June 11, 2013
By The McKellar Law Firm, PLLC on June 11, 2013 11:11 AM |

In the case titled Holt v. Holt, No. W2012-00265-COA-R3-CV, 2013 WL 1577831 (Tenn. Ct. App. Apr. 15, 2013) Tennessee divorce attorneys learn the parameters for alimony in futuro and alimony in solido in Tennessee divorce matters.

Facts: Husband and Wife founded a large church in Memphis. The church grew throughout the marriage and at the time of the divorce was housed in a multi-million dollar facility. Both parties were well-educated. Husband filed for divorce in 2009; however, the case was dismissed for failure to establish grounds. In 2010, Husband re-filed. Wife requested temporary spousal support which the divorce referee awarded in the amount of $3,300 per month. The referee also ordered Husband to continue paying the marital bills. The trial court agreed and entered an order.

After litigation for over a year, Husband and Wife agreed that grounds for divorce existed pursuant to Tenn. Code Ann. § 36-4-129(b) upon stipulated grounds. After several bifurcated hearings, the trial court entered its final decree of divorce. The court decreed the following: Wife was awarded $274.82 per month of Husband's pension; Wife was awarded alimony in solido in the amount of $29,700 due to Husband's failure to make mortgage payments on the marital residence; Wife was awarded alimony in futuro in the amount of $2,500 per month; Husband was ordered to pay half of Wife's attorney's fees; and the court rejected Wife's request for Husband to pay for her COBRA insurance benefits. Both parties filed appeals.

Analysis and Conclusion: On appeal Husband argued that the trial court erred in awarding Wife alimony in solido in the amount of $29,700 and alimony in futuro in the amount of $2,500 per month. Conversely, Wife asked the court to review whether the trial court erred in not requiring Husband to pay for her COBRA benefits and only ordering Husband to pay half of her attorney's fees. She also argued that the trial court erred in not considering income generated through the church based on the theory that the church was an "alter ego" of Husband when determining the amount of alimony and the distribution of the marital estate.

In addressing Wife's "alter ego" argument, the trial court averred that Wife did not cite any applicable laws or make any legally based argument to support her position in her brief. The court cited Forbess v. Forbess, 370 S.W.3d 347 (Tenn. Ct. App. 2011) which determined that if a party does not cite to an authority or detail an argument in its brief then the issue is considered waived. Because there was no legal authority or argument contained in Wife's brief to the Court to support her position, the issue was waived.

Next, alimony in solido is a form of long-term support that can be paid in a lump sum so long as there is a definite term. Tenn. Code Ann. § 36-5-121(h)(1). This type of alimony is considered a final judgment and is only modifiable by agreement of the parties. Wife was awarded alimony in solido in the amount of $29,700 which equaled nine (9) months of mortgage payments that Husband did not pay resulting in the marital home's foreclosure. The trial court provided that Husband could pay this amount in installments of $500 per month with no interest until the balance was paid.

In determining if the alimony in solido awarded to Wife for the missed mortgage payments was a proper judgment, the Court of Appeals averred they could not find any support for the trial court's finding. During trial, Wife neither asked the court to award her monies for the missed mortgage payments, nor was there any indication in the trial court's record that the award was an attempt to adjust distribution of the marital estate. The appellate court determined there was no basis to award wife the $29,700 as alimony in solido. Therefore, the judgment was reversed and remanded. The other portion of alimony in solido awarded to Wife for her attorney's fees was determined to be within the trial court's discretion and, therefore, was affirmed.

According to Tenn. Code Ann. § 36-5-121(f)(1), alimony in futuro is appropriate in matters where a disadvantaged spouse with "reasonable effort" is unable to earn an income that would permit a standard of living commiserate with that of the standard of living during the marriage. Courts look at several factors in determining if a spouse is "disadvantaged" such as: education, financial resources and obligations, duration of marriage, minor children of the marriage, standard of living during the marriage, fault of the parties, physical condition of the parties, assets of the parties, etc.

Here, the parties were ages 64 and 57 respectively at the time of the divorce. Both had some minor ailments, but were in good physical condition. The couple was married for 24 years with Wife working alongside Husband to grow the church they started in 1989. While both parties were similarly educated, Husband had an income of $9,000 per month; however, Wife was fired from her position in the church in January 2010 and had not gained other employment. During the marriage the couple enjoyed an income as high as $13,000 per month which the court deemed Wife would not be able to replicate. The appellate court found that the trial court correctly determined Wife had a need for support and affirmed its ruling on the award of alimony in futuro in the amount of $2,500 per month.

In regards to the COBRA insurance, Tenn. Code Ann. § 36-5-121(k) allows a court to order a party to pay health insurance premiums, "in whole or in part," for as long as the court deems necessary and the award is deemed a formed of alimony. Based on this statute the appellate court found that the trial court did not abuse its discretion in its refusal to order Husband to pay Wife's COBRA premiums and affirmed the ruling.