Karen Gaye Thompson Bounds v. Kenneth Newton Bounds ( 2018 )

09/06/2018
IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
May 31, 2018 Session
KAREN GAYE THOMPSON BOUNDS v. KENNETH NEWTON BOUNDS
Appeal from the Circuit Court for Bradley County
No. V-17-088 Lawrence Puckett, Judge
No. E2017-02366-COA-R3-CV
After ten years of marriage, Karen Gaye Thompson Bounds (“Wife”) sued Kenneth
Newton Bounds (“Husband”) for divorce. After a trial, the Circuit Court for Bradley
County (“the Trial Court”), inter alia, awarded the parties a divorce, divided the marital
property and debts, held that the marital residence was Husband’s separate property,
awarded Wife alimony in solido, and awarded Wife attorney’s fees. Husband appeals
raising issues regarding the award of alimony and the award of attorney’s fees. We find
and hold that the Trial Court did not abuse its discretion with regard to the award of
alimony or the award of attorney’s fees. We, therefore, affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed
Case Remanded
D. MICHAEL SWINEY, C.J., delivered the opinion of the court, in which CHARLES D.
SUSANO, JR. and JOHN W. MCCLARTY, JJ., joined.
H. Franklin Chancey, Cleveland, Tennessee, for the appellant, Kenneth Newton Bounds.
Jerry Hoffer, Cleveland, Tennessee, for the appellee, Karen Gaye Thompson Bounds.
OPINION
Background
Wife and Husband dated for almost two years before they were married in
December of 2006. When the parties met, Wife was working as a secretary for a real
estate company. By the time of the marriage, Wife was working as a receptionist and
legal assistant at a law firm. Approximately six months into the marriage, Wife was laid
off from her job through no fault of her own. Wife spent approximately two years
searching for a new job, but was unable to obtain one. She then stopped looking for
employment. Husband was disabled at the time of the marriage and throughout the
marriage and not employed. No children were born of the marriage. In February of 2017
Wife filed for divorce. The case proceeded to trial in October of 2017.
Wife testified at trial that she was 67 years old and in good health. She was not
working and had not worked since she was laid off early in the marriage. Wife attended
graduate school during the 1980s studying English, creative writing, and French
literature. Wife agreed that Husband neither dissuaded her from trying to work during
the marriage, nor insisted that she needed to work. Wife testified that when she was laid
off she received a benefit that became an annuity. She receives $286 per month from that
annuity and has about 17 years left on the annuity.
Wife testified that Husband was not employed when they married. He previously
had worked for Norfolk Southern Railroad. Wife testified that Husband has psoriatic
arthritis, a bad back, and is hard of hearing. During the marriage Husband had some
major back surgery and developed some neuropathy in his extremities. Wife was asked if
Husband was in pain during that time period, and she stated: “Very much so.”
At the time of the marriage, Husband owned a house on Mouse Creek that was
paid for. Husband sold this house and used the proceeds to purchase a house on Lower
Woods Trail, which the parties used as the marital home. The purchase price of the
marital home in 2007 was $333,000. Wife testified that the house is paid for. Wife’s
name was put on the deed of the marital residence when it was purchased in May of
2007, and the parties have lived there since the purchase. Wife testified that since
moving in to the marital residence, the parties have installed hardwood floors and quartz
counter tops and a backsplash.
Wife agreed that the marital home was paid for with Husband’s premarital funds.
Wife also agreed that Husband paid for the improvements made to the house during the
marriage using his disability income as Wife was not working. Wife testified that they
lived on Husband’s disability income during the marriage. Wife purchased some
decorations for the home, but agreed that she did not really make contributions to the
improvements to the house because she did not have much money.
Wife testified that Husband was very controlling during the marriage. She stated:
He fussed about even where I would put stuff on the shelves, the dishes.
Where I would shop, where I bought gas. He didn’t like the way I folded
his towels or the way I made his bed.
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He did not like it when I played my piano. I tried to play in the
morning because he didn’t get up until the afternoon and he would
complain that it woke him up. So if I played in the evening he would
complain that it was too loud because he was always watching TV.
Wife received an inheritance of $15,000 in February of 2017. Wife has not spent
that inheritance as she plans to use it in the future when she needs a new car. Husband
also received an inheritance during the marriage, but Wife did not know how much he
had received.
Wife testified that her main source of income is a railroad spousal annuity. Wife
started receiving the railroad spousal annuity in 2012. At the time of trial, the railroad
spousal annuity paid $922 per month, but Wife explained that it will be reduced to $645
after the divorce. Wife used the money she received from the railroad spousal annuity to
pay off her car. Wife then took the remainder and saved it in her checking account. Wife
had saved about $27,000 at the time of her deposition, which was taken several months
prior to trial. These savings along with the inheritance she received added up to about
$40,000 in assets that Wife had at the time of trial.
Wife moved into an apartment in March of 2017. She testified that she pays $984
per month in rent plus renter’s insurance, water, sewage, and taxes. Wife testified that
the parties have no credit card debt.
Husband testified that he was 72 years old at the time of trial. Husband explained
that he became disabled in May of 1996 and had been receiving disability income for
approximately ten years prior to the marriage. Husband receives railroad retirement
disability and a pension. He also has some mutual funds. Husband’s monthly income is
approximately $3,900.
Husband testified that he has ulcerative colitis, diabetic neuropathy, psoriatic
arthritis, osteoarthritis, and significant back problems. He also has eye pain that did not
respond to cataract surgery, and he wears hearing aids. Husband underwent a “spinal
fusion front and back.” He uses a walker or two canes to get around. Husband testified
that he is unable to do significant housework and has to pay people to assist him with
household chores.
Husband testified that he made the decision to purchase the marital home several
months after the marriage because the parties “were kind of tight with her furniture and
what I had left,” despite getting rid of some furniture. Husband testified that he paid a
substantial down payment and listed his current home for sale. Because a bridge loan
was necessary, Wife’s name was put on the deed to the marital house. Husband’s former
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house sold a little less than three months after the purchase of the marital home, and
Husband used the proceeds to pay off the bridge loan. Husband used some of the excess
funds from the sale to purchase a piano for Wife, pay off Wife’s car loan, and pay some
other expenses. Husband testified that the marital home was paid for completely with his
separate resources. Wife put no money into the marital home. During the year after the
purchase of the marital home, the house depreciated in value approximately $80,000 due
to the housing market and has not appreciated since that time.
Husband testified that at the time of the marriage he owned a house on Saddle
Creek Drive, had a 401(k) account, and had some mutual funds. Husband testified that
he sold some stock to buy the marital home and pay some expenses. Husband stated that
he used $150,000 of his separate funds during the marriage “to get by.” Husband
admitted that during the marriage he probably called Wife a “stealing gold digger.”
After trial, the Trial Court entered its Final Decree on November 20, 2017, inter
alia granting the parties a divorce, dividing the marital property and debts, awarding
Wife the $27,000 in railroad spousal annuity benefits that she had saved, holding that the
marital residence was Husband’s separate property, and awarding Wife alimony in solido
in the amount of $100,000. Husband appeals to this Court.
Discussion
Although not stated exactly as such, Husband raises two issues on appeal: 1)
whether the Trial Court erred in awarding Wife alimony in solido in the amount of
$100,000; and, 2) whether the Trial Court erred in awarding Wife her attorney’s fees.
We first consider whether the Trial Court erred in awarding Wife alimony in
solido in the amount of $100,000. Our Supreme Court has provided instruction with
regard to the standard of review of an award of alimony stating:
For well over a century, Tennessee law has recognized that trial
courts should be accorded wide discretion in determining matters of spousal
support. See Robinson v. Robinson, 26 Tenn. (7 Hum.) 440, 443 (1846)
(“Upon a divorce . . . the wife is entitled to a fair portion of her husband’s
estate for her support, and the amount thus to be appropriated is a matter
within the legal discretion of the chancellor. . . .”). This well-established
principle still holds true today, with this Court repeatedly and recently
observing that trial courts have broad discretion to determine whether
spousal support is needed and, if so, the nature, amount, and duration of the
award. See, e.g., Bratton v. Bratton, 136 S.W.3d 595, 605 (Tenn. 2004);
Burlew v. Burlew, 40 S.W.3d 465, 470 (Tenn. 2001); Crabtree v. Crabtree,
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16 S.W.3d 356, 360 (Tenn. 2000).
Equally well-established is the proposition that a trial court’s
decision regarding spousal support is factually driven and involves the
careful balancing of many factors. Kinard v. Kinard, 986 S.W.2d 220, 235
(Tenn. Ct. App. 1998); see also Burlew, 40 S.W.3d at 470; Robertson v.
Robertson, 76 S.W.3d 337, 340–41 (Tenn. 2002). As a result, “[a]ppellate
courts are generally disinclined to second-guess a trial judge’s spousal
support decision.” Kinard, 986 S.W.2d at 234. Rather, “[t]he role of an
appellate court in reviewing an award of spousal support is to determine
whether the trial court applied the correct legal standard and reached a
decision that is not clearly unreasonable.” Broadbent v. Broadbent, 211
S.W.3d 216, 220 (Tenn. 2006). Appellate courts decline to second-guess a
trial court’s decision absent an abuse of discretion. Robertson, 76 S.W.3d
at 343. An abuse of discretion occurs when the trial court causes an
injustice by applying an incorrect legal standard, reaches an illogical result,
resolves the case on a clearly erroneous assessment of the evidence, or
relies on reasoning that causes an injustice. Wright ex rel. Wright v.
Wright, 337 S.W.3d 166, 176 (Tenn. 2011); Henderson v. SAIA, Inc., 318
S.W.3d 328, 335 (Tenn. 2010). This standard does not permit an appellate
court to substitute its judgment for that of the trial court, but “ ‘reflects an
awareness that the decision being reviewed involved a choice among
several acceptable alternatives,’ and thus ‘envisions a less rigorous review
of the lower court’s decision and a decreased likelihood that the decision
will be reversed on appeal.’ ” Henderson, 318 S.W.3d at 335 (quoting Lee
Medical, Inc. v. Beecher, 312 S.W.3d 515, 524 (Tenn. 2010)).
Consequently, when reviewing a discretionary decision by the trial court,
such as an alimony determination, the appellate court should presume that
the decision is correct and should review the evidence in the light most
favorable to the decision. Wright, 337 S.W.3d at 176; Henderson, 318
S.W.3d at 335.
Gonsewski v. Gonsewski, 350 S.W.3d 99, 105-06 (Tenn. 2011) (footnote omitted).
Our Supreme Court has given further guidance with regard to discretionary
decisions stating:
The abuse of discretion standard of review envisions a less rigorous
review of the lower court’s decision and a decreased likelihood that the
decision will be reversed on appeal. Beard v. Bd. of Prof’l Responsibility,
288 S.W.3d 838, 860 (Tenn. 2009); State ex rel. Jones v. Looper, 86
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S.W.3d 189, 193 (Tenn. Ct. App. 2000). It reflects an awareness that the
decision being reviewed involved a choice among several acceptable
alternatives. Overstreet v. Shoney’s, Inc., 4 S.W.3d 694, 708 (Tenn. Ct.
App. 1999). Thus, it does not permit reviewing courts to second-guess the
court below, White v. Vanderbilt Univ., 21 S.W.3d 215, 223 (Tenn. Ct.
App. 1999), or to substitute their discretion for the lower court’s, Henry v.
Goins, 104 S.W.3d 475, 479 (Tenn. 2003); Myint v. Allstate Ins. Co., 970
S.W.2d 920, 927 (Tenn. 1998). The abuse of discretion standard of review
does not, however, immunize a lower court’s decision from any meaningful
appellate scrutiny. Boyd v. Comdata Network, Inc., 88 S.W.3d 203, 211
(Tenn. Ct. App. 2002).
Discretionary decisions must take the applicable law and the relevant
facts into account. Konvalinka v. Chattanooga–Hamilton County Hosp.
Auth., 249 S.W.3d 346, 358 (Tenn. 2008); Ballard v. Herzke, 924 S.W.2d
652, 661 (Tenn. 1996). An abuse of discretion occurs when a court strays
beyond the applicable legal standards or when it fails to properly consider
the factors customarily used to guide the particular discretionary decision.
State v. Lewis, 235 S.W.3d 136, 141 (Tenn. 2007). A court abuses its
discretion when it causes an injustice to the party challenging the decision
by (1) applying an incorrect legal standard, (2) reaching an illogical or
unreasonable decision, or (3) basing its decision on a clearly erroneous
assessment of the evidence. State v. Ostein, 293 S.W.3d 519, 526 (Tenn.
2009); Konvalinka v. Chattanooga–Hamilton County Hosp. Auth., 249
S.W.3d at 358; Doe 1 ex rel. Doe 1 v. Roman Catholic Diocese of
Nashville, 154 S.W.3d at 42.
To avoid result-oriented decisions or seemingly irreconcilable
precedents, reviewing courts should review a lower court’s discretionary
decision to determine (1) whether the factual basis for the decision is
properly supported by evidence in the record, (2) whether the lower court
properly identified and applied the most appropriate legal principles
applicable to the decision, and (3) whether the lower court’s decision was
within the range of acceptable alternative dispositions. Flautt & Mann v.
Council of Memphis, 285 S.W.3d 856, 872–73 (Tenn. Ct. App. 2008)
(quoting BIF, a Div. of Gen. Signal Controls, Inc. v. Service Constr. Co.,
No. 87–136–II, 1988 WL 72409, at *3 (Tenn. Ct. App. July 13, 1988) (No
Tenn. R. App. P. 11 application filed)). When called upon to review a
lower court’s discretionary decision, the reviewing court should review the
underlying factual findings using the preponderance of the evidence
standard contained in Tenn. R. App. P. 13(d) and should review the lower
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court’s legal determinations de novo without any presumption of
correctness. Johnson v. Nissan N. Am., Inc., 146 S.W.3d 600, 604 (Tenn.
Ct. App. 2004); Boyd v. Comdata Network, Inc., 88 S.W.3d at 212.
Lee Medical, Inc. v. Beecher, 312 S.W.3d 515, 524–25 (Tenn. 2010).
With regard to the different types of awards of alimony, our Supreme Court
explained in Gonsewski v. Gonsewski:
Current Tennessee law recognizes several distinct types of spousal support,
including (1) alimony in futuro, (2) alimony in solido, (3) rehabilitative
alimony, and (4) transitional alimony. Tenn. Code Ann. § 36–5–121(d)(1).
***
The second type of support, alimony in solido, is also a form of
long-term support. The total amount of alimony in solido is set on the date
of the divorce decree and is either paid in a lump sum payment of cash or
property, or paid in installments for a definite term. Tenn. Code Ann. § 36–
5–121(h)(1); Broadbent, 211 S.W.3d at 222 (“Alimony in solido consists of
a definite sum of money that is paid in a lump sum or in installments over a
definite period of time.”). “A typical purpose of such an award would be to
adjust the distribution of the parties’ marital property.” Burlew, 40 S.W.3d
at 471. Alimony in solido “may be awarded in lieu of or in addition to any
other alimony award, in order to provide support, including attorney fees,
where appropriate.” Tenn. Code Ann. § 36–5–121(d)(5). Unlike alimony
in futuro, the other form of long-term support, alimony in solido is
considered a final judgment, “not modifiable, except by agreement of the
parties,” and does not terminate upon the death or remarriage of the
recipient or payor spouse. Tenn. Code Ann. § 36–5–121(h)(2)–(3); see
Riggs, 250 S.W.3d at 456 n. 3.
***
Finally, in determining whether to award spousal support and, if so,
determining the nature, amount, length, and manner of payment, courts
consider several factors:
(1) The relative earning capacity, obligations, needs, and
financial resources of each party, including income from
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pension, profit sharing or retirement plans and all other
sources;
(2) The relative education and training of each party, the
ability and opportunity of each party to secure such education
and training, and the necessity of a party to secure further
education and training to improve such party’s earnings
capacity to a reasonable level;
(3) The duration of the marriage;
(4) The age and mental condition of each party;
(5) The physical condition of each party, including, but not
limited to, physical disability or incapacity due to a chronic
debilitating disease;
(6) The extent to which it would be undesirable for a party to
seek employment outside the home, because such party will
be custodian of a minor child of the marriage;
(7) The separate assets of each party, both real and personal,
tangible and intangible;
(8) The provisions made with regard to the marital property,
as defined in § 36–4–121;
(9) The standard of living of the parties established during the
marriage;
(10) The extent to which each party has made such tangible
and intangible contributions to the marriage as monetary and
homemaker contributions, and tangible and intangible
contributions by a party to the education, training or increased
earning power of the other party;
(11) The relative fault of the parties, in cases where the court,
in its discretion, deems it appropriate to do so; and
(12) Such other factors, including the tax consequences to
each party, as are necessary to consider the equities between
the parties.
Tenn. Code Ann. § 36–5–121(i). Although each of these factors must be
considered when relevant to the parties’ circumstances, “the two that are
considered the most important are the disadvantaged spouse’s need and the
obligor spouse’s ability to pay.” Riggs, 250 S.W.3d at 457. See also
Bratton, 136 S.W.3d at 605; Robertson, 76 S.W.3d at 342; Burlew, 40
S.W.3d at 470. Carefully adhering to the statutory framework for awarding
spousal support, both in terms of awarding the correct type of support and
for an appropriate amount and time, fulfills not only the statutory directives
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but also alimony’s fundamental purpose of eliminating spousal dependency
where possible.
Gonsewski, 350 S.W.3d at 107-10 (footnote omitted).
In his brief on appeal, Husband argues that the Trial Court failed to “fully
consider” the two most important factors in making its determination about alimony, i.e.,
need and ability to pay. Husband argues that he “cannot pay the $100,000 alimony award
without substantially jeopardizing his ability to continue to meet his future daily needs.”
He further asserts that the Trial Court failed to make a finding about Wife’s contribution
to the marriage. We disagree.
We begin, as we must as to this discretionary decision made by the Trial Court, by
presuming that the Trial Court’s decision to award Wife alimony in solido in the amount
of $100,000 is correct and viewing the evidence in the light most favorable to the
decision. The Trial Court found that Husband was leaving the marriage with
approximately $952,028 in assets. Wife was leaving the marriage with approximately
$42,000 in assets. The evidence in the record on appeal shows that Wife has a monthly
deficit of approximately $1,221 and that Husband has a monthly excess of over $800. A
careful and thorough review of the record on appeal shows that the Trial Court
considered all of the relevant statutory factors when making its decision about alimony.
The evidence in the record on appeal, as discussed more fully above, does not
preponderate against the Trial Court’s findings. As we find no abuse of discretion by the
Trial Court, we will not second guess the Trial Court or substitute our judgment for that
of the Trial Court.
Next, we consider whether the Trial Court erred in awarding Wife her attorney’s
fees. Our Supreme Court has instructed:
It is well-settled that an award of attorney’s fees in a divorce case
constitutes alimony in solido. See Tenn. Code Ann. § 36–5–121(h)(1)
(“alimony in solido may include attorney fees, where appropriate”);
Herrera v. Herrera, 944 S.W.2d 379, 390 (Tenn. Ct. App. 1996). The
decision whether to award attorney’s fees is within the sound discretion of
the trial court. Crabtree, 16 S.W.3d at 361; Kincaid v. Kincaid, 912
S.W.2d 140, 144 (Tenn. Ct. App. 1995). As with any alimony award, in
deciding whether to award attorney’s fees as alimony in solido, the trial
court should consider the factors enumerated in Tennessee Code Annotated
section 36–5–121(i). A spouse with adequate property and income is not
entitled to an award of alimony to pay attorney’s fees and expenses.
Umstot v. Umstot, 968 S.W.2d 819, 824 (Tenn. Ct. App. 1997). Such
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awards are appropriate only when the spouse seeking them lacks sufficient
funds to pay his or her own legal expenses, see Houghland v. Houghland,
844 S.W.2d 619, 623 (Tenn. Ct. App. 1992), or the spouse would be
required to deplete his or her resources in order to pay them, see Harwell v.
Harwell, 612 S.W.2d 182, 185 (Tenn. Ct. App. 1980). Thus, where the
spouse seeking such an award has demonstrated that he or she is financially
unable to procure counsel, and where the other spouse has the ability to
pay, the court may properly grant an award of attorney’s fees as alimony.
See id. at 185.
Gonsewski, 350 S.W.3d at 113.
A careful and thorough review of the record on appeal reveals that the Trial Court
considered all of the relevant statutory factors when makings its determination with
regard to the award of attorney’s fees. As discussed more fully above, the evidence in the
record on appeal does not preponderate against the Trial Court’s findings. We find no
abuse of discretion in the Trial Court’s decision to award attorney’s fees to Wife, and we,
therefore, will not second guess the Trial Court or substitute our judgment for that of the
Trial Court.
Conclusion
The judgment of the Trial Court is affirmed, and this cause is remanded to the
Trial Court for collection of the costs below. The costs on appeal are assessed against the
appellant, Kenneth Newton Bounds, and his surety.
__________________________________
D. MICHAEL SWINEY, CHIEF JUDGE
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