TN Ex Receiving Loans from Business Ineligible for Alimony Reduction
Tennessee alimony modification law case summary following 40 years of marriage. Alimony modification law from the Court of Appeals.
Jerry Dean Harkleroad v. Linda Althea Turner Harkleroad – Tennessee post-divorce alimony modification
The husband and wife were married in 1967 and divorced in 2007. At the time of the divorce, the court determined that the husband’s income from his company was $60,000. It ordered him to pay alimony in futuro of $1300 per month and to provide medical insurance. In 2012, the husband filed a petition to modify the support obligation. He based this on changed circumstances, in that he was now collecting Social Security, and that his total income was only $1660 per month in social security and retirement benefits. He testified that he was no longer receiving any income from his company. He acknowledged, however, that the company was paying some business expenses and had funded personal loans. In the three years after the divorce, these loans from the company had totaled $106,000. The wife was at this time eligible for Medicare.
The trial court denied any reduction in alimony. It found that the loans from the company were actually in lieu of salary, and constituted income for the husband. It further found that he had elected to be paid with these loans rather than with a salary. The trial court also ordered him to pay an additional $400 per month for arrearages. The husband appealed to the Tennessee Court of Appeals.
The Court of Appeals affirmed. It first noted that similar “loans” had been at issue at the time of the original divorce, and that the trial court had found them to be income of the husband. It also noted that the wife had continued to work, but that her ability to do so had declined since the time of the divorce. Even though she was receiving social security benefits, the amount of those benefits was less than the income that had been imputed to her at the time of the divorce. The Court of Appeals did note that the husband’s obligation to provide health insurance benefits had been reduced as a result of the wife’s eligibility for Medicare. However, it found that there was no other change of circumstances that would warrant a reduction in the husband’s obligation to pay alimony.
For these reasons, the Court of Appeals affirmed the judgment of the trial court. It also taxed the husband for the costs of the appeal.
No. E2012-01804-COA-R3-CV (Tenn. Ct. App. May 10, 2013).
See original opinion for exact language. Legal citations omitted.
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