Dorothy Rault Heideman v. Richard Lawrence Heideman ( 2002 )

IN THE COURT OF APPEALS OF TENNESSEE
AT JACKSON
JUNE 3, 2002 Session
DOROTHY RAULT HEIDEMAN v. RICHARD LAWRENCE HEIDEMAN
Direct Appeal from the Circuit Court for Shelby County
No. 163626 R.D.; The Honorable Karen R. Williams, Judge
No. W2001-01486-COA-R3-CV - Filed November 27, 2002
This appeal arises from a divorce initiated by the wife. The trial court granted the wife a divorce
based on adultery. The marital property was divided giving the wife approximately 55% or
$650,491.00 and giving the husband approximately 45% or $533,731.00. The trial court found that
the wife could not be rehabilitated and ordered the husband to pay $2,500.00 per month in alimony
in futuro. Additionally, the wife was awarded $15,000.00 in attorney’s fees. Husband raises issues
regarding the award of alimony in futuro and attorney’s fees for our review. For the following
reasons, we affirm in part as modified and reverse in part.
Tenn. R. App. P. 3; Appeal as of Right; Judgment of the Circuit Court Affirmed as
Modified in Part and Reversed in Part
ALAN E. HIGHERS, J., delivered the opinion of the court, in which W. FRANK CRAWFORD , P.J., W.S.,
and DAVID R. FARMER , J., joined.
Joe M. Duncan, Memphis, TN, for Appellant
Leslie Gattas Coleman, Pounders Coleman, Memphis, TN, for Appellee
OPINION
I. Facts and Procedural History
This is a divorce case. Dr. Richard L. Heideman (Husband) and Dorothy Rault Heideman
(Wife) were married on February 7, 1976. The parties separated in 1999 in Shelby county. The
Heidemans had one child who was twenty years of age at the time of separation. Wife filed for
divorce on August 26, 1999, alleging inappropriate marital conduct and irreconcilable differences.
On December 11, 2000, Wife amended her complaint to allege adultery. During the marriage, Wife
worked as a teacher and Husband as a pediatric oncologist. Husband is employed by St. Jude
Children’s Research Hospital where he earns $175,020 per year and is given matching funds for his
retirement account by his employer. Wife, who holds a Master’s Degree, teaches at St. Benedict at
Auburndale School where she receives a salary of $26,811 per year. Husband and Wife agreed to
attempt to resolve personal property matters through mediation and submitted all other matters for
trial.
After trial, in a Final Decree of Divorce, dated May 16, 2001, the lower court made the
following findings pertinent to the issues raised on appeal: that both parties are in their early fifties
and neither has unusual health problems; that divorce be granted to Wife on the basis of adultery;
that the marital property totaling $1,184,222.00 be divided 54.93% or $650,491.00 to Wife and
45.07% or $533,731.00 to Husband; and that the Wife had an additional $4000 per year in income
from oil and gas royalties.
On the issue of alimony, the trial court found rehabilitative alimony inappropriate because
Wife already holds a Master’s degree. After noting neither Husband’s nor Wife’s proposed post-
divorce budget was “out of line,” the court found that Wife had needs and that Husband had the
ability to pay. The trial court awarded Wife $2,500 a month in alimony in futuro and $15,000 for
partial payment of attorney’s fees. Husband timely filed a notice of appeal to this Court.
Husband presents the following four issues for our review:
I. Did the trial court err in awarding Wife $2500 per month as alimony in futuro?
II. Did the trial court err in refusing to require Wife to utilize the unearned income
that she receives from her oil royalty payments and the income she could receive
upon investment of the assets that she received as a division of marital property?
III. Did the trial court err in ordering Husband to pay $15,000 toward Wife’s legal
fees considering that she received almost fifty-five percent of the marital assets?
IV. Did the trial court err in refusing to consider the offer of proof by Husband
concerning the relative degree of fault by the parties as it may affect the payment
of alimony?
II. Standard of Review
The findings of fact made by a trial court are given a presumption of correctness that
will not be overturned unless the evidence preponderates against those findings. See Tenn.
R. App. P. 13(d); see also Bank/First Citizens v. Citizens and Assoc., 82 S.W.3d 259, 262
(Tenn. 2002) (citing Bogan v. Bogan, 60 S.W.3d 721, 727 (Tenn. 2001)). A trial court’s
ruling on a matter of law, however, will be reviewed “‘under a pure de novo standard . . .
according no deference to the conclusions of law made by the lower court[].’” Bank/First
Citizens, 82 S.W.3d at 727 (quoting Southern Constructors, Inc. v. Loudon County Bd. of
Educ., 58 S.W.3d 706, 710 (Tenn. 2001)). A trial court’s award of an amount of alimony
will not be disturbed unless the trial court has abused its discretion. Burlew v. Burlew, 40
S.W.3d 465, 470 (Tenn. 2001) (citing Crabtree v. Crabtree, 16 S.W.3d 356, 360 (Tenn.
2000)).
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III. Law and Analysis
A. Alimony
Husband’s first two issues are interrelated and thus will be addressed together.
Husband first asks whether the trial court erred in awarding Wife $2,500 a month alimony
in futuro. Husband next asks whether the trial court erred in not requiring Wife to defray
her monthly expenses by utilizing the income she receives from oil royalties and by taking
into account income Wife could receive from investing the property she received as part of
the property division made in this case. The Tennessee Supreme Court in its recent
decision, Robertson v. Robertson, 76 S.W.3d 337 (Tenn. 2002), held that when a trial court
is determining the nature and extent of support for a disadvantaged spouse, it must “consider
every relevant factor” in Tenn. Code Ann. § 36-5-101(d)(1). Similarly, in Burlew v. Burlew,
40 S.W.3d 465, 472 (Tenn. 2001), our Supreme Court stated that when a trial court considers
the purpose of the alimony award, along with the factors set forth in Tenn. Code Ann. § 36-5-
101(d), the trial court is given wide discretion in making an alimony award. The Burlew
court further noted that the purpose of alimony in futuro is to “provide financial support to
a spouse who cannot be rehabilitated.” Id. at 471. The most important considerations are
the “real need” of the disadvantaged spouse and ability of the obligor spouse to pay. Id. at
470 (quoting Aaron v. Aaron, 909 S.W.2d 408, 410 (Tenn. 1995)).
Before further analysis, a summary of the trial court’s findings on the factors listed
in Tenn. Code Ann. 36-5-101(d)(1)(A) through (L)1 is in order. Tenn. Code Ann. §
1
The statute re ads:
(d) (1) It is the intent of the general assembly that a spouse who is economically disadvantaged, relative to the other
spouse, be rehabilitated whenever po ssible by the granting of an order for payment of rehabilitative, temporary support
and maintenance. Where there is such relative economic disadvantage and rehab ilitation is not feasible in consideration
of all relevant factors, including those set out in this subsection, then the court may grant an order for payment of support
and maintenance on a long-term basis or until the death or remarriage of the recipient except as o therwise provided in
subdivision (a)(3). Rehabilitative support and maintenance is a separate class of spousal support as distinguished from
alimony in solido and periodic alimony. In determining whether the granting of an order for pa ymen t of support and
maintenance to a pa rty is appropriate, and in determining the nature, amount, length of term, and m anner of payment,
the court shall co nsider all releva nt factors, including:
(A) The relative earning cap acity, ob ligations, needs, and fina ncial resourc es of each pa rty, including income from
pension, profit sharing or retirement plans and all other sources;
(B) The relative education and training of each party, the ability and opportunity of each party to secure such education
and training, an d the necessity of a party to secu re further education and tra ining to improve such party's earning cap acity
to a rea sonable level;
(C) T he duration o f the marriage;
(D) The age and m ental co ndition of each party;
(continued...)
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101(d)(1)(A) directs the court to consider “[t]he relative earning capacity, obligations, needs,
and financial resources of each party, including income from pension, profit sharing or
retirement plans and all other sources.” The trial court found that Husband makes six times
the salary of Wife. After considering the proposed monthly needs of each party as outlined
in their respective Rule 14(c) memoranda, the trial court determined that neither Husband’s
nor Wife’s proposed budget was “out of line” considering their standard of living. Wife’s
Rule 14(c) Memorandum shows that Wife’s net monthly income is $2,070.37 and her
projected budget is approximately $5000 leaving a shortfall of approximately $3000. Wife
did not, however, include her income from oil royalties that she receives. The lower court,
after hearing extensive testimony on the value of these royalties from both Husband’s
financial expert and Wife’s financial expert, set the value at $333.00 per month “in actual
dollars for use by wife.” Thus, while not explicitly stating so, it seems the lower court found
Wife’s need to be approximately $2,700. Husband’s Rule 14(c) Memorandum showed a net
income of $8,931.00 per month and a budget of $6,580.00 leaving a surplus of approximately
$2350.00.
As to section (B), the trial court found that Wife holds a Master’s degree and that
there was no proof that further education would improve her earning capacity as a teacher.
The length of the marriage was twenty-five years--a long marriage for purposes of section
(C). For sections (D) and (E), the Final Decree of Divorce notes that both parties are in their
early fifties and that neither has any noteworthy health problems. Section (F) does not apply
1
(...continued)
(E) The physical condition of each party, including, but not limited to, physical disability or incapacity due to a chronic
deb ilitating disea se;
(F) The extent to which it would be undesirable for a party to seek employment outside the home beca use such party will
be cu stodian of a m inor ch ild of the marria ge;
(G) The separate assets of ea ch pa rty, both real and persona l, tangible and intangible;
(H) The pro visions m ade with rega rd to the marital property as defined in § 3 6-4-1 21;
(I) T he stand ard o f living of the p arties established during the marriage;
(J) The extent to which each party has made such tangible and intangible contributions to the marriage as monetary and
homemaker contrib utions, and tangible and intangible contrib utions by a party to the ed ucation, training or increased
earning power of the other party;
(K) The relative fault of the parties in cases where the court, in its discretion, deems it appropriate to do so; and
(L) Such other factors, including the tax consequences to each party, as are necessary to consider the equities between
the parties.
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because the Heideman’s son is not a minor. Under section (G), separate property, the parties
divided most of their personalty amongst themselves, and it does not appear that the court
made any specific findings as to any other separate property. In the division of marital
property, for purposes of section (H), Wife was given 54.93% or $650,491.00 and Husband
was given 45.07% or $533,731.00. The standard of living of the parties during the marriage,
to be considered in section (I), was relatively high, as noted by the trial court when approving
the proposed budgets of the parties. As to section (J), there was testimony as to the
contributions each party made to the marriage, but the trial court made no finding on this
issue. The trial court declined to consider the relative fault of the parties for the purposes of
section (K). No specific findings appear relating to section (L).
After considering these factors, the trial court found that “rehabilitative alimony
would not be appropriate” because Wife holds a Master’s degree in education and there was
no proof that Wife’s earning capacity could be increased by further education. The trial court
instead awarded the wife alimony in futuro in the amount of $2,500 a month. It is apparent
from the record that the trial court properly considered all of the factors listed above and in
its discretion awarded alimony in futuro rather than the preferred rehabilitative alimony. We
find no abuse of discretion in the award of alimony in futuro.
Husband questions whether the trial court properly calculated Wife’s needs in setting
this amount. First, Husband questions whether the trial judge considered income that Wife
receives from oil and gas royalties. Husband and Wife presented extensive testimony from
their respective financial experts concerning the value of these royalties. The trial court set
the value of this asset at $4,000 per year or $333.33 per month “in actual dollars for use by
Wife.” We see no error in this decision. Next, Husband questions the finding that Wife
should not “have to invade either the corpus of her division of the marital assets or its
earnings each month to pay daily living expenses.” The trial court felt that this money should
be used either for the purchase of a home or to increase Wife’s retirement fund. Husband,
citing section 36-5-101(d)(1)(A) which directs a court to consider “income from . . . all other
sources,” argues that the trial court should have taken into account, when determining Wife’s
needs, the income that Wife’s sizeable property settlement could bring if invested. Husband
further argues that the trial court, when setting the amount of alimony, did not take into
account the “provisions made with regard to the marital property as defined in § 36-4-121"
as is required by Tenn. Code Ann. 36-5-101(d)(1)(H). We find Husband’s arguments on this
issue persuasive.
We agree with the trial court that Wife has need and that Husband has ability to pay,
however, we cannot agree that potential earnings from Wife’s sizeable property settlement
should not be taken into consideration when calculating her “daily” needs. Wife received
$366,415.00 in cash accounts and $251,263.00 in retirement assets. Wife’s proposed budget
includes $1,500 a month for housing expenses, yet the trial court found that “[i]t is
unreasonable for Wife to have to invade either the corpus of her division of the marital assets
or its earnings each month” to meet her expenses because that money should be “set aside”
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either to purchase a new home or to fund Wife’s retirement to a level “as comfortable” as
Husband expects. We find that the trial court abused its discretion in making this
determination.
Tennessee Code Annotated section 36-5-101(d)(1)(A) instructs that “income from
. . . all other sources” be considered in setting the amount of alimony and Section 36-5-
101(d)(1)(H) requires a court to consider the division of marital assets when making this
same determination. We find that an analysis under the factors listed above, including
section (A) and section (H) requires a modification of the amount of alimony Wife is to
receive because the marital property division will provide her with additional income that
should be used to decrease her “real needs.” While there are a myriad of investment
possibilities available to Wife, if she were to invest the $366,415.00 and were to receive a
5% rate of return,2 she would have approximately $1,500.00 a month in additional income.
Even if Wife does nothing more than deposit this sum into a bank account making as little
as 2% interest, she would receive an additional $610.00 a month in income. Alternatively,
Wife may choose to spend the money, either buying a house with the lump sum, or in some
other fashion. Regardless of which option she chooses, the use of the property settlement
awarded to Wife reduces the needs she outlined the proposed budget accepted by the trial
court. Accordingly, we modify the amount of in futuro alimony awarded to Wife by the trial
court downward from $2,500.00 to $2,000.00 per month.
B. Award of Attorney’s Fees.
Husband next asks whether the trial court erred in awarding Wife $15,000.00 as
attorney’s fees. An award of attorney’s fees is considered alimony in solido. Miller v.
Miller, 81 S.W.3d 771, 775 (Tenn. Ct. App. 2001) (citing Herrera v. Herrera, 944 S.W.2d
379, 390 (Tenn. Ct. App. 1996)). Because attorney’s fees are an award of alimony, a trial
court must apply the statutory factors of Tenn. Code Ann. § 36-5-101. Sullivan v. Sullivan,
No. M2001-0325-COA-R3-CV, 2002 Tenn. Ap. LEXIS 641, at *12 (Tenn. Ct. App. 2002)
(citing Kincaid v. Kincaid, 912 S.W.2d 140, 144 (Tenn. Ct. App. 1995)). The most
important factors in an award of alimony are the need of the disadvantaged spouse and the
ability of the obligor spouse to pay. Burlew v. Burlew, 40 S.W.3d 465, 470 (Tenn. 2001)
(quoting Aaron v. Aaron, 909 S.W.2d 408, 410 (Tenn. 1995)). A trial court’s award of
alimony will not be disturbed unless the trial court has abused its discretion. Id. (citing
Crabtree v. Crabtree, 16 S.W.3d 356, 360 (Tenn. 2000)). In the case at bar, the trial court
awarded Wife $15,000 as attorney’s fees. Wife was given approximately 55% or $
650,491.00 of the marital property. We find that Wife has no need in light of the substantial
amount of marital property Wife received as well as the other statutory factors considered
above. Thus, we reverse the award of attorney’s fees.
2
While both Husband and Wife’s financial experts testified to various rates of returns that might be expected
if the W ife were to invest the money, Wife’s expert testified to a possible 5% rate, the lo west mentioned by either expert.
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C. The Trial Court’s Refusal to Consider the Relative Fault of the Parties
Lastly, Husband asks whether the trial court erred in refusing to consider the relative
fault of the parties when setting the amount of alimony. Tenn. Code Ann. 36-5-101(d)(1)(K)
states that the court may consider “[t]he relative fault of the parties in cases where the court,
in its discretion, deems it appropriate to do so.”
During her case in chief, Wife put on testimony about Husband’s ongoing adulterous
affair. The court stated after hearing testimony from Husband’s paramour that “[b]y
[Husband’s] own admission, by the admission of the witness on the stand right now, I find
that the divorce will be granted on grounds of adultery. That ends it.” The court informed
the parties that the only other testimony that would be heard on the subject would be used
to determine if there was a dissipation of assets by either party. When Husband began to put
on his proof, he attempted to introduce testimony concerning problems in the marriage. Wife
objected to the testimony stating that she understood there would be no further testimony
relating to fault. The trial court sustained the objection stating “[t]his case is boiled down
to a division of assets . . . .” and “I’m not going to balance fault.”
The pertinent statute gives the trial court discretion whether to balance fault or not.
We find no abuse of discretion in the trial’s courts decision not to balance fault in the current
case and thus deny Husband’s contention on this issue.
IV. Conclusion
The award of alimony in futuro is affirmed as modified to $2,000.00 per month. The
award of attorney’s fees is reversed. Costs of this appeal are taxed equally to the Appellant,
Richard Lawrence Heideman, and his surety, and the Appellee, Dorothy Rault Heideman,
for which execution may issue if necessary.
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ALAN E. HIGHERS, JUDGE
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