TN Dad Unable to Sell Website for $1M Determined Not Underemployed
Tennessee child support law case law summary on lowering from the Court of Appeals. Note: This is the second case summary on this blog.
Sean Eric Von Tagen v. Robin Lynn Von Tagen – Lowering Tennessee Child Support law – not voluntarily underemployed
The Parties were married 14-years and had four sons, ages 11, 9, 6, 4 at the time of their divorce in 2006. Sean Von Tagen (“the Father”) had a gross monthly income of $7,000 and Robin Von Tagen (“the Mother”) had a gross monthly income of $200. While the Father’s presumptive child support obligation was $743, he agreed to pay $2,000/month in the Parties’ “Marital Dissolution Agreement,” which was incorporated into the final decree of divorce. Child support would continue until the youngest child reached 18-years of age or graduated from high school. The Father was also required to pay for the Children’s health insurance, uncovered medical and eye care expenses, and, if available through his employer, the Children’s dental, orthodontic, and optical insurances.
In early 2008, the Father filed a petition for downward modification of his child support obligation, alleging a significant change in circumstances, which was not anticipated or foreseeable at the time of his divorce.
Earlier in the Parties’ marriage, the Father was self-employed, working in the stock trading profession. He had an undergraduate degree in business. His income history exceeded $100,000/year. However, during the marriage and prior to the divorce, the Father had a down year in 2002, earning only $15,000, which motivated him to change occupations and by 2005 was earning $77,000/year working on websites.
At trial, the Father acknowledged that when he signed the “Marital Dissolution Agreement” he was not earning $7,000/month – he was not even earning the funds necessary to remit the child support plus alimony he had agreed to pay to the Mother.
The back story of the case turned out to be the Father’s “belief” that, at the time of the divorce, he was on the eve of selling one of his websites for $1 million. The Father testified he was “blind-sided” when that deal fell through shortly after the divorce.
The Father eventually sold the website for $350,000 in 2007, remitting $110,000 to the Mother towards his child support and alimony arrears. The Father secured employment at his parents’ business for $50,000/year plus health benefits as a director of sales and marketing for the company’s product line of tabletop photo studios. The Father testified that, in the interim, he had liquidated his retirement, savings, and checking accounts. He established his monthly expenses at $2,735.41/month, demonstrating he was living paycheck-to-paycheck.
The trial court used the statutory analysis found at Tennessee Comp. Rules & Regulations section 1240-02-04-.04(e)(a)(2)(iii), and found that the Father was not willfully or voluntarily underemployed.
The trial court praised the Father: “This unanticipated reduction in his ability to provide support for his children in the manner that he had hoped is not as a result [of] his refusal to work. In fact, the Court finds that [Father] has done a remarkably good job in keeping his finances in order during the last several months and that he did the appropriate and responsible act in bringing this matter back to court for this Court’s assistance when he realized that he was not going to be able to continue to satisfy his obligation of child support in the future.” [Bracketed material in original.]
The Mother, meanwhile, submitted expenses of $9,700/month while claiming unemployment and receiving food stamps. The Mother’s testimony relative to the value of the house appeared to exceed $720,000, of which there may have been more than $400,000 in equity. The Mother held a college degree, attended an out-of-state course to become a makeup artist and went to classes to become a cosmetologist. The Mother earned $10/hour in 2006 and 2007 for limited work at a hair salon. She did not earn any income in 2008. The Mother testified she “hoped to earn $4,000 per month once she establishes her business as a makeup artist.”
By contrast to the Father, the trial court imputed income to the Mother, finding her to have an unexercised earning capacity. In fact, the trial court expressly found that the Mother “has a substantial amount of free time when she could be working, and it also found that Mother was living well beyond her means…” In a footnote, it was noted “She said that her lifestyle was being supported by money from her parents and credit cards.”
The trial court found the Father’s child support obligation to be $1,609/month on income of $2,441/month for the Father and $29,300/year for the Mother. The Court of Appeals affirmed these findings. It did not find error in the conclusion of the trial court that the Father was neither willfully or voluntarily underemployed. The determination of the Court of Appeals was unanimous.
No. M2009-00850-COA-R3-CV (Tenn. Ct. App. Mar. 12, 2010).
See original opinion for exact language. Legal citations omitted.
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