1

FILED

May 27, 1999

Cecil Crowson, Jr.

Appellate C ourt

Clerk

IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

FRANK VERNON SOUTHERS, ) C/A NO. 03A01-9802-CV-00001

)

Plaintiff-Appellant,)

)

)

)

) APPEAL AS OF RIGHT FROM THE

v. ) SULLIVAN COUNTY LAW COURT

)

)

)

)

PATSY LORETTA SOUTHERS, )

) HONORABLE R. JERRY BECK,

Defendant-Appellee. ) JUDGE

For Appellant For Appellee

JOHN S. BINGHAM DAVID S. HAYNES

Hawkins, Moody, Bingham, Bristol, Tennessee

 Miller, P.C.

Kingsport, Tennessee

O P I N I O N

AFFIRMED AND REMANDED Susano, J.
1

In doing so, the trial court, without saying so, actually set aside or

modified a provision of the divorce judgment of May 12, 1995, which provides

that Husband pay Wife’s medical insurance premiums “for three years or until

retirement or death.” (Emphasis added).

2

This is a post-divorce case. The trial court set aside

that portion of the parties’ judgment of divorce dealing with the

issue of periodic alimony. It then entered a new decree again

establishing Frank Vernon Southers’ (“Husband”) periodic alimony

obligation at $2,000 per month, but decreeing new terms as to

when his obligation would terminate. In a subsequent order, the

trial court decreed that Husband should reimburse Patsy Loretta

Southers (“Wife”) the sum of $6,255.44 for medical insurance

premiums previously paid by her. The second order further

directs that Husband pay Wife’s premiums in futuro until May 12,

1998.1 Husband appeals from these orders, raising four issues

for our consideration:

1. Does a confidential relationship exist

between married parties after they have

separated and while they are engaged in

divorce proceedings?

2. Did the trial court abuse its discretion

in setting aside a divorce judgment on the

ground of constructive fraud where the party

in whose favor the relief was granted had not

filed a motion pursuant to Rule 60.02,

Tenn.R.Civ.P.?

3. Did the trial court err in permitting

Wife to introduce a doctor’s medical record

which recounts a conversation prior to the

parties’ divorce between Husband and his

physician regarding Husband’s desire “to

apply for social security disability”?

4. Did the trial court, in reimposing an

alimony obligation on Husband, fail to

properly consider the relevant factors found

at T.C.A. § 36-5-101(d)(1)(A)-(L)?
3

I.

The parties’ divorce judgment, entered May 12, 1995,

dissolved a marriage of over 38 years. Wife was then 57 years

old and Husband was 61. The parties did not have minor children.

The divorce judgment was entered pursuant to the

parties’ oral agreement on economic issues and their stipulation

that Wife was entitled to a divorce on the ground of

inappropriate marital conduct. Both parties were represented by

counsel. The divorce judgment specifies, in some detail, each

asset of the marital estate, its value, and the party to whom it

was awarded. Wife received marital assets valued at $520,969,

and Husband was awarded marital assets with a total value of

$296,477.61. As a part of the division of the marital estate,

and included in the figures previously stated, each of the

parties received “50% short term retirement” and “50% long term

retirement.” Under the heading of “Alimony,” the judgment

provides as follows:

Husband’s income is $6,233/mo. after taxes. 

Husband will pay Wife $2000.00 per month

until his retirement or death. Husband will

pay for Wive’s [sic] health care insurance

for three years or until retirement or death,

under COBRA. First payment due May 4, 1995

and 4th of each month thereafter until after

the 4th of the month of Husband’s retirement. 

Husband will apply each 18 months for Wive’s

[sic] COBRA rights.

(Emphasis added).
4

Husband was a State Farm Insurance agent. He

terminated his employment with State Farm effective December 31,

1995, having elected to retire because of a disability associated

with a heart condition. As a result of his disability

retirement, Husband receives a monthly Social Security check of

$985 and a monthly disability check of $5,200. His retirement

triggered State Farm’s five year payout for the assets of his

agency -- referred to in the divorce judgment as “short term

retirement.” Effective as of Husband’s retirement, both he and

Wife started receiving a monthly check of $1,239.07 -- payments

that will terminate in 60 months. At the conclusion of this

period, State Farm will commence its “long term retirement”

payments, which are also being equally split between the parties

pursuant to the terms of their divorce judgment. The “long term

retirement” payments continue until Husband’s death. 

Husband refused to pay alimony after December, 1995. 

He made his last medical insurance premium payment for Wife in

January, 1996. His position was, and still is, that his

obligation to pay periodic alimony and Wife’s medical insurance

premiums terminated upon his retirement and, according to him,

his disability constitutes retirement as contemplated by the

divorce judgment.

On February 19, 1996 -- some nine months after the

divorce judgment was entered -- Wife filed a pleading entitled

“Petition to Enhance Alimony as to Duration and Amount.” The

petition alleges that “[i]t was contemplated that retirement

would reduce the husband’s income, therefore, his ability to pay
5

alimony.” Instead, so the petition correctly alleges, Husband’s

disability retirement increased his income. According to the

petition,

[t]he retirement of the husband without

disability was contemplated and it was

thought that this would reduce his ability to

pay. This was contemplated, and provided

for, in the judgment of May, 1995. The work

stoppage due to disability, enhancing the

husband’s ability to pay, was not

contemplated.

Following a bench trial on Wife’s petition, the trial court found

that Husband had failed to disclose to Wife that he was seriously

considering disability retirement prior to the time that the

parties finally negotiated the settlement of the economic issues

in their divorce; that a confidential relationship existed

between the parties during their negotiations and up to the time

of their divorce; that this confidential relationship gave rise

to Husband’s fiduciary duty to disclose this contemplatedretirement information to Wife; and that Husband’s failure to do

so was a violation of his fiduciary duty to his then-spouse. 

Accordingly, the trial court set aside the alimony/medical

insurance portions of the divorce judgment on the basis of

“constructive fraud,” and, in two separate decrees, ordered as

follows:

That [Husband’s] alimony obligation shall be

fixed in the amount of Two Thousand Dollars

($2,000.00) per month and the same shall be

due and payable from and after February,

1996. [Husband’s] alimony obligation shall

terminate when [Husband’s] disability pay

from the State Farm plan with CIGNA ceases or

at his death whichever first occurs.
6

* * *

[Husband] is ORDERED to pay to [Wife], in

addition to the sums heretofore ordered and

adjudged in the prior Order, the sum of

$6,255.44, which is reimbursement for medical

insurance premiums at $399.44 per month for

1996 and $232.70 per month for 1997,

calculated as $6,255.44 through August, 1997. 

After August, 1997 the amount shall continue

to be $232.70 per month through 1997, and

thereafter, beginning in January, 1998, such

amount that will purchase the same coverage

that was purchased for $399.44 per month in

1996. The premiums shall be due and payable

from [Husband] to [Wife] for her medical

insurance premium reimbursement until May 12,

1998.

II.

In finding a confidential relationship between the

parties, the trial court relied, at least in part, on the

decision of this court in the case of Howell v. Davis, 306 S.W.2d

9 (Tenn.App. 1957). In Howell, this court found that a woman’s

spouse, who was dead at the time of trial, had fraudulently

induced her to sign a deed. In finding that the transfer was

voidable upon application of the defrauded wife, the court stated

as follows:

In view of the marital relationship and the

fact that Mr. Howell was the more dominant

personality and managed the business affairs

of the family; that he selected the attorney

and was the moving influence in the execution

of the deed which was greatly to the

disadvantage of Mrs. Howell, we think a

confidential relationship existed between

them and that the burden of proof rested upon

his heirs at law to show that, in executing

the deed of 1941, Mrs. Howell was fully and

correctly advised of the purpose and effect

of the deed and that there is a presumption

that the deed was fraudulently obtained.
7

“The relation of husband and wife has been

regarded as one of special confidence and

trust, and in contracting with each other

they must exercise the utmost good faith. 

The court will closely scrutinize all

transactions between them to the end that

injustice and oppression may not result.”

Id. at 12. (Emphasis added). The trial court in the instant

case also cited as persuasive authority this court’s opinion in

Lightman v. Magid, 394 S.W.2d 151 (Tenn.App. 1965), which stands

for the principle

[t]hat a confidential relationship exists

between a prospective husband and wife who

execute an antenuptial agreement while they

are engaged to be married which requires the

utmost good faith and full disclosure of all

circumstances materially bearing on the

contemplated contract. 

Id. at 156. The trial court in the instant case rationalized

that if parties negotiating a prenuptial agreement stand in a

confidential relationship with one another, then such a

relationship must exist between these parties who were married.

Husband takes the position that “[t]o hold that a

confidential or fiduciary relationship exist[s] between estranged

spouses in a divorce action who are negotiating a settlement

through their attorneys does not reflect reality.” In this case,

we agree with Husband’s position; but we do not agree that this

requires a reversal of the trial court’s most recent orders.

In the instant case, the parties had been separated for

over 17 months before the divorce was granted; each had sued the
8

other for divorce; and each was represented by counsel. There is

nothing in the record to indicate that they had personally

negotiated any aspect of the settlement of the economic issues in

this case. On the contrary, all negotiations appear to have been

undertaken through counsel and the parties apparently did not

even talk to one another after their separation. There is

nothing about the relationship between these separated,

divorcing, represented-by-counsel parties to suggest that their

relationship -- contentious as it then obviously was -- falls

within one of the “three distinct classes” giving rise to a duty

to disclose. See Justice v. Anderson County, 955 S.W.2d 613,

616-17 (Tenn.App. 1997). This case is not like Howell. In that

case, the court was dealing with a transaction between spouses

during an intact marriage. Here, the parties were married in

name only, and they were clearly dealing at arms’ length, through

counsel, with absolutely no trust or confidence reposed by one in

the other.

It is important to recognize what this case does not

involve. There are no allegations or proof in the record that

Husband made an affirmative misrepresentation. He apparently was

not asked in discovery regarding whether his health condition --

about which Wife had some, but incomplete, information -- had

prompted him to consider early disability retirement. This is

also not a case where a party hides the existence of a marital

asset or otherwise makes an affirmative misrepresentation

regarding a marital asset -- one that amounts to an act of fraud. 

Obviously, an act of fraud can be the basis for setting aside a
9

negotiated marital dissolution agreement. See Rule 60.02(2),

Tenn.R.Civ.P.

We know of no Tennessee appellate case authority

deciding whether, and to what extent, a confidential relationship

giving rise to a duty to disclose -- as distinguished from a duty

not to engage in an affirmative misrepresentation or a duty not

to hide marital assets -- exists as between divorcing parties. 

Other states have recognized such a duty under some

circumstances. See Avriett v. Avriett, 363 S.E.2d 875, 877

(N.C.App. 1988) (holding that the “confidential relationship that

usually exists between husband and wife” terminated when they

“become adversaries” in the course of negotiating a divorce

settlement); Eltzroth and Eltzroth, 679 P.2d 1369, 1372 (Or.App.

1984) (“Because the fiduciary duty is imposed as a result of the

confidential relationship between the parties, it continues while

the parties contemplate divorce, as long as the confidential

relationship remains intact and the parties are not dealing at

arms’ length through separate agents or attorneys.”); Gabbert v.

Johnson, 632 P.2d 443, 446 (Okla.App. 1981) (“Both parties were

represented by able counsel. Once she filed her action, the

woman no longer enjoyed a confidential relationship with her

husband. He did not have to voluntarily disclose anything.”);

Jeffries v. Jeffries, 434 N.W.2d 585, 587-88 (S.D. 1989) (“While

it is generally true that a husband and wife do enjoy a

confidential relationship,...we do not believe that such a

relationship existed here. When the parties to a marriage are

negotiating a property settlement, recognizing that their

interests are adverse to one another and that they are dealing at
10

arms [sic] length, neither spouse owes to the other the duty of

disclosure which he or she would normally owe if their

relationship remained, in fact, a confidential one.”). Cf.

McDonald v. Barlow, 705 P.2d 1056, 1060 (Idaho App. 1985)

(“Throughout the property settlement negotiations, the

relationship between McDonald and Barlow was that of husband and

wife. The fiduciary duty arising from that relationship was not

affected by the parties’ separation.”). In the instant case, we

do not find it necessary to define, by way of a bright-line rule,

when the confidential relationship recognized in Howell

terminates in the context of a divorce. Suffice it to say that

it had clearly terminated in this case.

While we disagree with the reason advanced by the trial

court to justify his judgment in this case, this does not close

our inquiry. On a de novo review, such as the one in which we

are now engaged, we are “called upon to pass upon the correctness

of the result reached in the [t]rial [c]ourt, not necessarily the

reasoning employed to reach the result.” Shelter Insurance

Companies v. Hann, 921 S.W.2d 194, 202 (Tenn.App. 1995). In the

instant case, we agree with the result reached by the trial

court, i.e., the extension of Husband’s alimony obligation until

his monthly disability payments stop or he dies, whichever of the

two events occurs first. We also agree with the trial court

decision to require Husband to pay for Wife’s medical insurance

premiums until May 12, 1998.

In a post-divorce proceeding, a court has the power to

“decree an increase or decrease of [an award of spousal support]
2

By contrast, “rehabilitative, temporary support and maintenance” stays

within the control of the court “for the duration of such award.” T.C.A. §

36-5-101(d)(2).

11

only upon a showing of a substantial and material change of

circumstances.” T.C.A. § 36-5-101(a)(1). Unless and until a

petitioning party demonstrates a “substantial and material change

of circumstances,” the existing award of spousal support is res

judicata. Hicks v. Hicks, 176 S.W.2d 371, 374-75 (Tenn.App.

1943).

“Under T.C.A. § 36-5-101(a)(1), it is clear that the

ordinary decree for support remains within the control of the

Court and is subject to modification.” Anderson v. Anderson, 810

S.W.2d 153, 154 (Tenn.App. 1991).

Husband argues that the trial court did not have the

power to change the alimony/insurance provisions because there

was no longer an obligation to pay periodic alimony or provide

for Wife’s medical insurance premiums. He contends that he had

fully satisfied his periodic alimony/insurance obligations before

Wife filed her petition. We disagree with Husband’s analysis. 

T.C.A. § 36-5-101(a)(1) gives a court the power to modify a

periodic alimony in futuro decree. That statute does not limit a

court’s right to modify to those situations where the previous

periodic alimony obligation has not been fully satisfied

according to its terms.2 We are not aware of any authority for

the proposition advanced by Husband. Furthermore, we think his

argument is at odds with the broadly-stated right to modify set

forth in T.C.A. § 36-5-101(a)(1).
12

In the instant case, it is clear that the parties

contemplated a retirement by Husband that would result in a

decrease in his income -- the usual situation in the typical

retirement. Instead, Husband’s disability retirement resulted in

substantial income not contemplated at the time of the divorce

judgment -- a monthly disability payment of $5,200. While

Husband’s present net income is not shown in the record, it is

clear that his present gross income is $7,424.07. This compares

with a monthly net of $6,233, the amount upon which the alimony

award of $2,000 per month was originally based. We find that the

circumstances of the parties had changed in a substantial and

material way, justifying the action of the trial court. Thus,

even though we disagree with the trial court’s decision to set

aside the original alimony/insurance decrees because of fraud, we

agree that the court was justified in the changes decreed by it

based upon a substantial and material change in the parties’

circumstances.

III.

Husband argues that the trial court should not have

admitted into evidence a record from the office of Dr. Jerry L.

Miller containing the following statement regarding the doctor’s

conversation with Husband on April 21, 1995, some 21 days before

the parties’ divorce:

Patient and I had a lengthy discussion about

his retirement and he wants to apply for

social security disability. I encouraged him

to do so and he will apply.
3

Husband argues that Wife did not prove each of the elements set forth

in Rule 803(6), Tenn.R.Evid.

13

The stated basis for Husband’s objection at trial was

that Wife had failed to call the records custodian to

authenticate the proffered document. In fact, the record is

clear that the document in question was furnished by Husband’s

counsel in response to a request to produce documents. In

furnishing this document, without qualification, in response to a

request for Husband’s medical records, Husband, in effect,

authenticated the document.

To the extent that Husband now poses additional3

reasons why the document was not admissible, those grounds were

waived when they were not raised at the time the document was

offered as evidence by Wife. See NEIL P. COHEN, ET AL., TENNESSEE

LAW OF EVIDENCE § 103.3 (3d ed. 1995). In any event, and even

assuming for the purpose of discussion that the trial court erred

in admitting the challenged document, we do not find that the

trial court’s ruling amounts to an “error involving a substantial

right [that] more probably than not affected the judgment or

would result in prejudice to the judicial process.” See Rule

36(b), T.R.A.P. This is because we have resolved in Husband’s

favor the issue, i.e., violation of a fiduciary duty, upon which

the document was offered and received into evidence.

IV.

Finally, Husband argues that the evidence preponderates

against the trial court’s determination that Wife needs $2,000 of
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alimony. We disagree. Wife testified to her needs, and it is

obvious that the trial court believed her testimony. The issue

of credibility was for the trial court. Massengale v.

Massengale, 915 S.W.2d 818, 819 (Tenn.App. 1995); Bowman v.

Bowman, 836 S.W.2d 563, 566 (Tenn.App. 1991). We find no error

in the award on this basis.
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V.

The judgment of the trial court is affirmed. This case

is remanded to the trial court for such further proceedings as

may be required, if any, consistent with this opinion, and for

collection of costs assessed below, all pursuant to applicable

law.

__________________________

Charles D. Susano, Jr., J.

CONCUR:

________________________

Houston M. Goddard, P.J.

________________________

Herschel P. Franks, J.