In the case titled Owens v. Owens, No. 2012-01186-COA-R3-CV 2013 Slip Copy, WL 3964793 (Tenn. Ct. App. July 30, 2013) Knoxville divorce attorneys learn when it is appropriate for a rehabilitative alimony award to be modified to alimony in futuro.
Facts: Husband and Wife were married 25 years and divorced in 2004. As part of the divorce, Wife was awarded rehabilitative alimony. An appeal of the trial court's decision resulted in a change to the original division of marital property and increased the amount and duration of the alimony through November 2012.
In 2009, Wife filed a petition requesting the court to increase her alimony or change the award to alimony in futuro. To support her argument, Wife asserted she was unable to support herself selling real estate or teaching yoga classes. She averred she had to increase her credit card debt and borrow money from family in order to pay her living expenses while Husband had fewer expenses and a more disposable income.
A trial was held on Wife's petition in 2011. At the time, Wife was 62 years old. Wife provided proof to the court of her attempts to support herself through selling real estate and teaching yoga. She provided evidence of real estate classes and renovation bills to turn her pool house into a yoga studio. When this did not work, Wife rented the pool house for $700 a month. However, her mother became ill and was unable to pay for in home care, so Wife let the tenant go to allow her mother to move in so she could care for her. As further proof of her financial dilemma, Wife introduced a statement of monthly income and expenses an increase from the statement included with her original petition of more than $3,000 per month. These expenses did not include a mortgage or car payment as both were already paid in full.
In 2012 the trial court issued its Memorandum and Order denying Wife the relief she sought citing that she did not meet the preponderance of evidence standard. It further stated that Wife did not exhaust all reasonable efforts to support herself. However, the trial court did find Wife to have a need for continued alimony and kept her current award in effect. Wife appealed this decision.
Analysis & Conclusion: In the case a bar, Wife sought to extend her rehabilitative alimony or convert it to alimony in futuro. Tenn. Code Ann. § 36-5-121(c)(2) states that the court has discretion to control the duration, increase, decrease, termination, modification, or extension of rehabilitative alimony. It further states that the burden of proving reasonable efforts lies on the receiving party in order to show the court a need for an extension or increase of same.
The Tennessee Supreme Court has added that once an award of alimony has been made, it can be modified if it is shown to the court that the receiving party's prospects for rehabilitation have materially changed. If it is deemed by the court that the party cannot feasibly rehabilitate, the trial court can convert the alimony award to alimony in futuro. The standard for rehabilitation, as provided by Tennessee statute, requires the disadvantaged party, through reasonable efforts, to reach an earning capacity that permits the party to enjoy a reasonably comparable standard of living to that which was enjoyed when married. The Tennessee Supreme Court has also explained that a material change in circumstances occurs when an unanticipated change happens after the initial award has been granted by the court.
In this case, the trial court found that Wife had a continuing need for alimony and limited job skills. The appellate court agreed with these findings. At trial, it was learned that Husband earned a significant income and had the likelihood of continuing to earn same. Wife had not worked outside the home since 1980.
In considering these factors, the appellate court found Wife to have made reasonable efforts to rehabilitate by selling real estate, but, due to the market, she was unable to do so. It also considered her age and skill set and found that she did not have the capacity to earn a living comparable to that which she enjoyed when married. Therefore, it was determined that the modification from rehabilitative alimony to alimony in futuro was appropriate and within the court's discretion.
However, when looking at Wife's assets, the appellate court saw that Wife was awarded a partial interest in a real estate company that had the potential to produce rental income. It was also found that when Wife's mother moved in with her, Wife could then rent her mother's home for additional income.
For these reasons the appellate court modified the alimony award to alimony in futuro, and modified the amount from $3,000 per month to $2,000 per month.