Denise Elizabeth Bailey (Price) v. Gregory Ross Price ( 2010 )

IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
Assigned on Briefs June 1, 2010
DENISE ELIZABETH BAILEY (PRICE) v. GREGORY ROSS PRICE
Appeal from the Circuit Court for Sumner County
No. 26502-C C. L. Rogers, Judge
No. M2009-01787-COA-R3-CV - Filed December 2, 2010
The trial court reduced a divorced husband’s alimony obligation because of a decline in his
income from existing and expected future reductions in his overtime hours at the Post Office.
The wife argues on appeal that her medical condition continues to prevent her from working,
so her need remains the same as it was before, and that a reduction in alimony is therefore
unjustified, even if the husband’s ability to pay declines. She also argues that the trial court
erred in taking future reductions in husband’s overtime hours into consideration, which she
characterizes as speculative. We find that under the circumstances of this case the reduction
in alimony ordered by the trial court did not constitute an abuse of its discretion, and we
therefore affirm its judgment.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed
P ATRICIA J. C OTTRELL, P.J., M.S., delivered the opinion of the Court, in which F RANK G.
C LEMENT, J R. and A NDY D. B ENNETT, JJ., joined.
Grayson Smith Cannon, Goodlettsville, Tennessee, for the appellant, Denise Elizabeth Bailey
Price.
John R. Phillips, Jr., Gallatin, Tennessee, for the appellee, Gregory Ross Price.
OPINION
I. P RIOR P ROCEEDINGS
The primary issue in this appeal is whether the trial court abused its discretion by
reducing a husband’s alimony obligation after he experienced a decline in income, even
though the wife’s needs did not decrease. The alimony obligation previously imposed on the
husband was the subject of an earlier opinion by this court, Denise Elizabeth Bailey Price v.
Gregory Ross Price, No. M2005-02704-COA-R3-CV, 2007 WL 1555828 (Tenn. Ct. App.
May 29, 2007) (no Tenn. R. App. P. 11 application filed). We need not repeat here all the
details about the divorce proceedings that were discussed in that opinion, but we must touch
on some of them briefly, to give some context to our discussion about the alimony
modification at issue.
Gregory Ross Price (“Husband”) and Denise Elizabeth Bailey (“Wife) were married
in 1995. Their marriage produced no children, but Wife had two children from an earlier
marriage. In 1998, Wife was diagnosed with brain cancer, a terminal illness. The parties
separated in 2003 and they were divorced by the Circuit Court of Sumner County in 2005.
The trial court divided the marital property between the parties, including the proceeds from
the sale of the marital home, which was sold before the divorce. Wife had received most of
those proceeds up front. The trial court found that Husband was entitled to payment of
$9,000 from the proceeds that Wife had retained. Since Wife no longer had the money, the
court ordered her to repay Husband by giving him a $250 credit against his monthly alimony
obligation for a period of 36 months.
In the divorce decree filed on November 9, 2005 the trial court declared that
rehabilitative alimony for Wife was “unnecessary and not feasible” because of her medical
condition and prognosis, but that since she was unable to work, she was in need of some
form of alimony. The court also found that Husband had always been very supportive of
Wife, that his income from a military pension and his job as a letter carrier with the post
office gave him the ability to pay alimony, and that the relatively short duration of the
marriage was outweighed by Wife’s physical condition and her grave need.
The court accordingly ordered Husband to pay Wife transitional alimony of $960 per
month for 36 months.1 The court also ordered Husband to pay additional alimony in the form
of Wife’s COBRA health insurance premium of $311 per month. Another $250 a month was
designated as alimony, but was paid in the form of a credit to Husband for repayment of his
share of the equity in the marital home. Wife subsequently filed a petition to modify
alimony, which the trial court granted in an order dated January 13, 2006. That order
increased Husband’s cash obligation to $1,260 per month and left intact the other
components of the alimony award.
1
The first version of the Final Decree of Divorce, entered on September 19, 2005, awarded Wife
alimony of $381 per month, in light of her receipt of $579 per month in Social Security disability benefits.
She subsequently lost those benefits, and in a revised decree filed on November 9, 2005 the trial court
increased the alimony award to $960 per month.
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Wife appealed, asking this court among other things to increase the alimony award
and to change the form of the award from transitional alimony to alimony in futuro. In Price
v. Price, supra, we agreed with the trial court that rehabilitative alimony was not feasible
because of Wife’s medical condition, but we disagreed with its determination that it was
“unnecessary” or that under the circumstances of Wife’s illness, short-term transitional
alimony was an appropriate alternative. We accordingly modified the alimony award to
make it an award of alimony in futuro, “to terminate automatically and unconditionally upon
the death or remarriage of the recipient.” See Tenn. Code Ann. § 36-5-121(f)(3).
Turning to the amount of the alimony award, we noted that it included two
components aside from the $1,260 per month that Husband was ordered to pay directly to
Wife: the $311 per month that Husband was paying for Wife’s COBRA health insurance, and
the additional $250 per month to reimburse Husband for his share of the equity retained by
Wife after the sale of the marital home. We calculated that the total of direct and indirect
alimony payments amounted to $1,821 per month. Since no transcript or statement of the
evidence from the modification hearing was placed in the record, we concluded that we had
to presume that the trial court’s findings as to Husband’s ability to pay and Wife’s need were
correct.
We accordingly affirmed the $1,821 per month obligation, but ordered that when
Wife’s eligibility for COBRA insurance coverage expired, the alimony paid directly to her
would increase to $1,571 per month, and that when Husband has been compensated in full
for his share of the net proceeds from the sale of the marital home, he would then directly pay
Wife $1,821 per month as alimony in futuro.
II. M ORE A LIMONY M ODIFICATIONS
Several other modifications of alimony followed the entry of our opinion in this
matter. One occurred when Husband suffered a job-related injury, and the trial court reduced
his monthly alimony payment to $849 for the months of January through April of 2008.
Upon Wife’s subsequent motion, Husband was ordered to repay $800 of this reduction in
monthly installments.
On October 8, 2008, Wife filed a motion to have at least $1 of her monthly alimony
paid directly from Husband’s military retirement pay, in order to make her eligible for
healthcare coverage through the Continued Health Care Benefit Program of Humana Military
(CHCBP). According to Wife, her regular COBRA coverage was scheduled to expire on
November 9, 2008, but eligibility for insurance under CHCBP would enable her to continue
the same coverage for the same premium of $311 per month. On November 5, 2008, the
court entered an agreed order providing that $1 per month of Husband’s alimony obligation
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would henceforth come from his military retirement pay.
The order that is the subject of this appeal arose after Wife filed a petition to hold
Husband in contempt and to order him to pay arrears for failing to increase his alimony
payment after the satisfaction of her repayment obligation on the proceeds of the marital
home. Husband filed a counter petition, in which he denied any willful contempt, and asked
the court to reappraise his alimony obligation in light of his injury, his present physical
condition, changes in post office policy which he asserted would reduce his earning ability,
and Wife’s possible eligibility for government programs of financial aid.
The trial court conducted a hearing on February 24, 2009.2 Both parties presented
statements of income and expenses to the court. Wife’s statement showed monthly expenses
of $2,910, and no regular income, since she remains unable to work. Subtracting alimony
of $1,821 from her expenses, she calculated a monthly shortfall of $1,089. Wife also
testified that she was receiving cancer treatment at a hospital in Florida, and that she had
received some funds from various charitable sources to help her pay the costs of travel and
housing, but that those payments should not be considered additional regular income, but
only as gifts to defray the cost of her care.
Husband’s statement was based on his 2008 income. It showed net monthly income,
including his military retirement of $1,552, as $5,214. His expenses, including alimony and
COBRA payments amounted to $4,992, very nearly matching his net income. Husband
called to the stand Mr. Seth Pepoon, a customer service supervisor with the United States
Postal Service. Mr. Pepoon testified that because the Post Office anticipated staggering
losses, overtime hours for employees would have to be reduced or eliminated.
Wife objected to this line of testimony as speculative because Mr. Pepoon was unable
to testify as to how many overtime hours Husband would lose as a result of the across the
board reductions. A Post Office Memorandum and a Press Release about cutbacks were
entered into the record. The press release included a statement that in order to eliminate $5.9
billion in costs through the 2010 fiscal year, 100 million work hours would be eliminated.
Husband also entered recent pay stubs, which showed a reduction in his overtime hours from
an average of 37 hours monthly in 2008 to 12 hours monthly in 2009, through the month of
2
No transcript was made of this hearing, nor of any subsequent hearing. However, the record
contains a Statement of the Evidence derived from this hearing as well as from the hearing of July 27, 2009,
prepared by Wife pursuant to Tenn. R. App. P. 24(c). Husband filed objections to Wife’s Statement,
specifically relating to her omission of certain evidence and/or testimony. The trial court approved the
Statement of the Evidence, subject to Husband’s objections. See Tenn. R. App. P. 24(e) and (f). Our account
of these proceedings is derived from that Statement.
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February.
In its order of March 5, 2009, the trial court extrapolated Husband’s overtime hours
for January and February to the entire year, and calculated that it showed his net monthly
income decreasing by 20%, and that he therefore no longer had the ability to pay his full
alimony obligation. The court concluded that “[a] review of current factors including the
Plaintiff’s health, earning ability, needs, and Defendant’s earning, expenses and lack of
resources established a joint dismal situation.” The court accordingly ordered that Husband’s
alimony obligation be temporarily reduced to $1,000 monthly, plus the costs of the previously
ordered COBRA health insurance. The court also declared that the temporary alimony would
become permanent on July 31, 2009 unless either party requested a review. Husband was
ordered to provide copies of his current check stubs to Wife so she could track his income
over time.
Several subsequent motions were filed and heard, which chiefly involved adjustments
to Husband’s alimony obligations to address arrearages, overpayments and wage assignment.
The changes ordered by the trial court were intentionally designed to restore Wife’s
eligibility for Supplemental Social Security Income and succeeded in achieving that result.
Wife filed a motion to review the court’s decision on temporary alimony, which was
heard on July 27, 2009. She testified at that hearing that she had reapplied for SSI benefits
and that the Social Security Administration had notified her that it would pay her $449.34
monthly in Supplemental Security Income payments as of July 1, 2009.3 Wife explained,
however, that even with the additional supplement, her dismal financial situation remained
the same, and that she was still unable to pay her basic expenses.
Ms. Inkyoung Hong, the postmaster at the Hendersonville Post Office, where Husband
worked, testified that although overtime had been significantly reduced at the
Hendersonville Post Office, it had not been eliminated, that Husband continued to request
overtime, and that in any case his union contract guaranteed him forty hours of work per
week.
3
We note that by adding Husband’s $1,000 per month alimony obligation, the $331 per month health
insurance payment and the monthly $449.34 SSI benefit, Wife was receiving a total of $1,780, only slightly
less than she had received when Husband’s monthly alimony obligation was $1,821. Unfortunately, even
if the trial court had chosen to allow Husband’s alimony obligation to remain the same, Wife’s income would
still be insufficient to meet her stated need.
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Stubs from Husband’s paychecks since the hearing of February 24, 2009 were entered
into the record. According to Husband, they showed that his overtime hours between March
6 and July 24, 2009 averaged 7.67 per bi-monthly pay period, or 15.34 hours per month. Our
own calculations confirm this.4 We also note that if all of Husband’s January and February
paychecks were included in the calculation, the average would be 8.86 hours per pay period
or 17.72 hours per month.
In a very brief order, filed on July 28, 2009, the trial court declared that Husband’s
circumstances had not changed significantly since its order of March 5, 2009, and that he still
did not have the ability to pay increased alimony. The court accordingly ordered that
Husband’s alimony obligation would remain at $1,000 per month plus the cost of Wife’s
medical insurance. This appeal followed.
III. A NALYSIS
This court reviews the trial court’s findings of fact de novo with a presumption of
correctness, unless the evidence preponderates otherwise. Tenn. R. App. P. 13(d); Blair v.
Brownson, 197 S.W.3d 681, 684 (Tenn. 2006). We review questions of law de novo with no
presumption of correctness. Whaley v. Perkins, 197 S.W.3d 665, 670 (Tenn. 2006). Thus,
“[w]e will affirm the trial court’s decision unless there is an error of law affecting the result
or unless the evidence preponderates against the trial court’s factual determinations.”
Campanali v. Campanali, 695 S.W.2d 193, 194 (Tenn. Ct. App. 1985).
Our legislature has authorized the courts to award alimony in divorce cases “to be paid
by one spouse to or for the benefit of the other, or out of either spouse’s property, according
to the nature of the case and the circumstances of the parties.” Tenn. Code Ann. §
36-5-121(a). To guide the courts in determining whether an award of alimony is appropriate,
and the nature and amount of that award, the legislature has set out a list of factors for the
trial courts to consider. Tenn. Code Ann. § 36-5-121(i). These factors include the relative
earning capacities of the parties, the physical condition of each party, and the duration of the
marriage.
4
Husband argues that if certain pay periods during the months of May, June and July were excluded
from the calculation, the average would have dropped to 4.69 hours per pay period, or 9.88 hours per month.
Husband characterized those pay periods as “anomalous,” because they involved scheduling issues primarily
related to the vacations of other employees. We do not believe we should exclude from our calculations
those pay periods, however, because Husband took 80 hours of leave during the first half of 2009, which also
reduced his overtime, and thus were likewise anomalous, but in the opposite direction.
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Our courts have frequently stated, however that in determining the proper amount of
alimony to award, the most important factors to consider are the need of the obligee spouse
and the obligor’s spouse’s ability to pay. Martin v. Martin, 155 S.W.3d 126, 131 (Tenn. Ct.
App. 2004); Anderton v. Anderton, 988 S.W.2d 675, 682 (Tenn. Ct. App. 1998); Barnhill v.
Barnhill, 826 S.W.2d 443, 455 (Tenn. Ct. App. 1991). Unfortunately, these factors are not
always reconcilable, because the needs of the obligee spouse can be greater than the obligor’s
ability to pay. In such cases, no perfect solution lies within the powers of the trial court. This
case is a prime example of that kind of situation.
Generally, the amount of an alimony award is deemed to be in the sound discretion
of the trial court, and the trial court’s determination will not be reversed on appeal unless that
discretion is abused. Burlew v. Burlew, 40 S.W.3d 465, 470 (Tenn. 2001); Morton v.
Morton, 182 S.W.3d 821, 836 (Tenn. Ct. App. 2005); Lindsey v. Lindsey, 976 S.W.2d 175,
180 (Tenn. Ct. App. 1997). Our Supreme Court explained the abuse of discretion standard
as follows in Eldridge v. Eldridge, 42 S.W.3d 81, 84 (Tenn. 2001):
“Under the abuse of discretion standard, a trial court's ruling will be upheld so
long as reasonable minds can disagree as to propriety of the decision made.”
State v. Scott, 33 S.W.3d 746, 752 (Tenn. 2000); State v. Gilliland, 22 S.W.3d
266, 273 (Tenn. 2000). A trial court abuses its discretion only when it
“applie[s] an incorrect legal standard, or reache[s] a decision which is against
logic or reasoning that cause[s] an injustice to the party complaining.” State
v. Shirley, 6 S.W.3d 243, 247 (Tenn. 1999). The abuse of discretion standard
does not permit the appellate court to substitute its judgment for that of the
trial court. Myint v. Allstate Ins. Co., 970 S.W.2d 920, 927 (Tenn. 1998).
In accordance with the above standard, appellate courts are generally disinclined to
second-guess a trial court’s determination of alimony unless it is not supported by the
evidence or is contrary to public policies reflected in the applicable statutes. Brown v.
Brown, 913 S.W.2d 163, 169 (Tenn. Ct. App. 1994).
The record indicates that the same Circuit Court judge heard all the motions and
petitions in this case, dating back all the way to the parties’ 2005 divorce. His orders show
that he has been consistently mindful of the factors the courts are directed to consider when
fashioning an alimony award, including Wife’s need and Husband’s ability to pay. Because
Wife had no other regular source of income at her disposal other than alimony, the court
based the alimony award in its decree of November 9, 2005 entirely on Husband’s ability to
pay. The court calculated that Husband’s net income from his military pension and his full-
time job exceeded his reasonable expenses by less than $2,000 per month, and it ordered
Husband to pay Wife alimony of $1,821 per month in cash and equivalent value.
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In 2008, Husband asked for a reduction in alimony, contending that his ability to pay
had declined because of a decline in the number of overtime hours available to him. After
a full hearing, the trial court agreed with Husband’s contention, and reduced his alimony
obligation from $1,821 per month to $1,000 in cash and $311 in medical coverage, for a total
of $1,311, a reduction of $510 per month. The July 2009 final order finds no change in those
amounts awarded earlier was warranted.
Wife argues that such a reduction was not warranted. She argues that Husband’s
income rose between 2005 and 2008, and that there was no firm proof as to the impact on his
earnings from systemwide reductions in post office overtime.5 Wife notes that Husband
admitted taking two cruises in 2009, and that he advanced money to his son and his son’s
fiancé to take one of these cruises with him. She also notes that Husband had previously
allotted $220 of his military retirement pay to his mother, and that she died some time after
the hearing of February 24, 2009, thereby freeing up that amount of income for alimony.
While these allegations and arguments may have supported a different result from the
one reached by the trial court, the question for us is not whether the court could have reached
a different result, but whether it abused its discretion in ruling as it did. It is well-established
that income derived from overtime may be considered in alimony determinations, Robertson
v. Robertson, 76 S.W.3d 337 (Tenn. 2002); Nelson v. Nelson, 106 S.W.3d 20, 24 (Tenn. Ct.
App. 2002). Conversely, a reduction in overtime can be the basis for a reduction in alimony.
See Dempsey v. Dempsey, No. M1998-00972-COA-R3-CV, 2000 WL 1006945 at *9 (Tenn.
Ct. App. July 21, 2000) (no Tenn. R. App. P. 11 application filed).
It is undisputed that Husband continued to seek overtime during the entire course of
these proceedings and that in every one of its orders the trial court considered Husband’s
overtime in its calculation of his ability to pay. In its order of March 5, 2009, the court
estimated that Husband’s overtime was reduced from an average of 37 hours a month to 12
hours a month and it accordingly adjusted his alimony downwards. As we noted above,
Husband actually averaged 17.72 hours of overtime during the first half of the year.
The record nonetheless shows that Husband has already experienced a reduction in
the number of overtime hours available to him. As we stated above, our role is not to
fine-tune a trial court's alimony award, but rather to determine whether it reflects a proper
application of the relevant legal principles and that it is not clearly unreasonable. Broadbent
v. Broadbent, 211 S.W.3d 216, 220 (Tenn. 2006); Bogan v. Bogan, 60 S.W.3d 721, 733
(Tenn. 2001). It does not appear to us that the trial court applied an incorrect legal standard
5
Husband’s 2009 income and expenses statement shows increases in both income and expenses over
his 2005 statement.
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to the facts of this case or that its decision is against logic or reasoning. We therefore do not
believe that the trial court abused its discretion in reducing Husband’s alimony obligation to
the extent it did.
IV.
The judgment of the trial court is affirmed. We remand this case to the Circuit Court
of Sumner County for any further proceedings necessary. Tax the costs on appeal to the
appellant, Denise Elizabeth Bailey Price.
_________________________________
PATRICIA J. COTTRELL, JUDGE
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