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DIVORCE 43: TRIAL COURT’S DECISION REGARDING MODIFYING SPOUSAL SUPPORT MUST BE AFFIRMED UNLESS IT IS CLEARLY INEQUITABLE

Plaintiff and defendant were married in 1990 and divorced in 2013.  The parties’ consent judgment of divorce provided, among other things, that defendant would pay plaintiff modifiable spousal support in the amount of $3,200 per month.  At the time the judgment was entered, defendant was employed full-time at General Motors (GM) and earned a salary of over $100,000 per year.  In August 2016, defendant moved to modify the spousal support award, asserting that he had recently undergone back surgery and was no longer earning his GM salary, but was instead receiving disability as his income.  After the parties engaged in mediation, the trial court ultimately entered a consent order modifying the judgment of divorce to reduce defendant’s monthly spousal support obligation to $2,500 per month.  The modification was based upon plaintiff’s imputed income of $18,000 per year and defendant’s income of $91,000 per year.

 

 In November 2017, defendant again moved to modify the spousal support provision in the consent judgment of divorce.  Defendant asserted that he suffered severe medical issues and had been terminated from his employment such that his income was no longer $91,000.  The trial court conducted an evidentiary hearing, after which it entered an order modifying defendant’s monthly

spousal support obligation to $2,000.  This Court thereafter granted defendant’s delayed application for leave to appeal.

STANDARD OF REVIEW

This Court reviews the trial court’s factual findings relating to the award or modification of spousal support for clear error.  A finding is clearly erroneous if the appellate court is left with a definite and firm conviction that a mistake has been made.  When a trial court’s findings are not clearly erroneous, we must then decide whether the dispositional ruling was fair and equitable in light of the facts.  IWe review an ultimate spousal support award for an abuse of discretion, which occurs when a trial court’s decision falls outside the range of reasonable and principled outcomes.

PURPOSE OF SPOUSAL SUPPORT

The goal in awarding spousal support is to balance the incomes and needs of the parties so that neither will be impoverished; spousal support is to be based on what is just and reasonable under the circumstances of the case.  A spousal support award can be modified on the basis of a showing of new facts or changed circumstances.  The party moving for modification has the burden of showing such new facts or changed circumstances. 

CHANGE IN CIRCUMSTANCES

Defendant here moved for modification of spousal support due to an asserted loss of employment and thus a significant loss of income.  At the evidentiary hearing on defendant’s motion, defendant testified that he is 64 years old and was last employed in October 2017.  He testified that he had previously been employed at GM, but had been on disability for all of 2016 due to major surgeries.  He tried to go back to work in early 2017, but was thereafter hospitalized a couple of times and underwent surgery.   Defendant testified that he was terminated in October 2017 for non-performance.

At the conclusion of the evidentiary hearing, the trial court required defendant to submit his 2017 W-2’s.  It also required both parties to provide their bank statements from the past two years and their income tax returns for the past three years.  After its review of the documentary evidence, the trial issued a written opinion and order reducing defendant’s monthly spousal support obligation to $2,000 per month.  We find no abuse of discretion in the trial court’s award.  The trial court generally opined, based on the record evidence, that there was a change of circumstances that warranted a modification of the spousal support order.  It then noted that to determine the appropriate amount of spousal support, it was to consider the spousal support factors.  The trial court specifically and explicitly considered each factor in the written record.

SPOUSAL SUPPORT FACTORS

The trial court noted that plaintiff’s testimony and submitted documents indicated that the majority of her income comes from spousal support and that she receives a lesser amount of social security benefits than defendant.  It noted that defendant resides with a partner and shares living expenses with her (having done so for five years), as well as being provided with a car.  Plaintiff, on the other hand, lives alone and is heavily dependent upon the spousal support for her 2017 income of $32,741.

Defendant next asserts that the trial court was not even-handed in its treatment of income and savings to the parties.  Specifically, defendant states that while the trial court found that defendant had $300,000 in retirement savings that he had not drawn upon, it failed to acknowledge that plaintiff was not taking all of her available pension benefits, nor was she drawing on her share of the retirement accounts. 

The trial court did note that defendant has $300,000 in a retirement account that he has not yet drawn from.  It also heard and acknowledged plaintiff’s testimony that she had approximately $131,000 in an account (presumably her share of the parties’ retirement accounts) and resided in the marital home, which had approximately $60,000 in equity.  Plaintiff was also questioned regarding pension benefits and the only pension benefit she indicated that she expected to receive (but was not yet receiving) is a $100 per month benefit from Boeing.  Defendant has provided no indication that there were additional pension benefits that plaintiff could be collecting but was not. 

The trial court also clearly acknowledged defendant’s failing health (and plaintiff’s good health) and his reduced income in fashioning an appropriate spousal support award.  The trial court indicated that defendant was in poor health and was unlikely to return to full time work, but that plaintiff also had little chance of full-time work given her being outside of the workforce for 25 years and now being 65 years of age.  If, as defendant asserts, the court should have considered the $100 per month that plaintiff could, but was not yet receiving into its equity consideration, the amount would add up to only $1,200 more per year to plaintiff’s income.  Adding that to plaintiff’s admittedly unreported income of $2,400 per year for caregiving services would equal an additional $3,600 in yearly income to plaintiff’s $32,741 reported income.  The minimal $3,600 per year in income would likely not drastically affect plaintiff’s ability to meet her needs for the foreseeable future.

The trial court focused significantly on general principles of equity  in reaching its decision.  The court indicated that neither party spends excessively, but that plaintiff is just meeting her minimum needs, while defendant spends substantially more money dining out and had recently made an $800 purchase while unemployed and receiving disability.  The trial court noted that plaintiff’s bank account balance in 2018 averaged between $680 to $1,700, whereas defendant’s bank account balance for that year averaged between $1,758 to $4,510.73.  Moreover, defendant was not having difficulty meeting his basic needs, even being on a much lower income and with poor health while plaintiff, without spousal support, would have a monthly income of just $1,565.  The trial court thus found that reducing the spousal support award to lower than $2,000 per month would inequitably impoverish her and create a significant hardship on her ability to meet her financial needs.  We find no error in these factual findings.

The trial court's decision regarding spousal support must be affirmed unless we are firmly convinced that it was inequitable. Overall, the trial court’s statements and findings were supported by the evidence, and were not unfair or inequitable.  The trial court thus did not abuse its discretion in finding $2,000 per month, still modifiable, a proper spousal support award.

ADVICE TO CLIENTS FACING SPOUSAL SUPPORT ISSUES IN DIVORCE CASES

Aldrich Legal Services understands what a stressful time this is for you when your circumstances have changed and you need to modify your spousal support in a divorce.

Aldrich Legal Services represent parties throughout southeast Michigan with a wide range of divorce related matters.

Contact Aldrich Legal Services

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