### IN THE COURT OF APPEALS OF TENNESSEE AT JACKSON
JOHNNA LEA HAYES (BEUERL EIN) v. JEFF C. HAYES

Direct Appeal from the Chancery Court for Haywood County

No. 10956 George R. Ellis, Chancellor

No. W1999-00445-COA-R3-CV - Decided July 12, 2000

This appeal a

rises from a dispute between Plaintiff Johnna Lea Hayes ( Beuerlein) and Defendant Jeff C. Hayes regarding the a mount of Mr. Hayes’ child support obligation and the enforcement of a promissory

note executed by

Ms. Beuerlein in conjunction with the parties’ divorce. The trial court found (1) that Mr. Hay

es has an annual i

ncome o f $64,139.00, (2) that Mr. Hayes’ child support obligation is $1,221.00 per month but thatthis amount should be reduced to $621.0 0 per month until Ms. Beue rlein’s debt under the promissory note is satisfied, (3) that Mr. Hayes’ child suppor t arrearage is equal to $14,940.00, (4) that Ms. Beuerlein’s deb t und er the promissory note is equal
to $39,569.85, (5) tha t, subtracting Mr. Hayes’ child support arrearag e from Ms. Beuerlein’s debt under the promissory

note, the net amoun

t that Ms. Beuerle

in owes to Mr. Hayes is $24,665.85 plus
ten percent (10%) i

nterest, and (6)

that each party

shall pay his

or her ownattorney’s fees. For the

reasons set forth below, the ruling of the trial court is affirmed in part, reverse

d in part, and the ca

use is remanded for further proceedings consistent with this opinion.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court is Affirmed in part; Reversed in part;

and Remanded.

F ARMER , J., delivered the opinion of the court, in which H IGHERS , J., and L ILLARD , J., joined.

L. L. Harrell, Jr

., Trenton, Tenne

ssee, for the app

ellant, Jeff C. Ha

yes.
Nancy S. Nelson, Jackson, Tennessee, for the appellee, Johnna Lea Hayes (Beuerle in).

OPINION

Mr. Hayes and M

s. Beuerlein

are the parents of two minor children, namely Harrison, born December 9, 1988, and Katie, born June 13, 1990. At the time of the parties’ divorce in February of 1995, the children were placed in the parties’ joint cu st ody. The parties’ marital dissolution agreement

provided, however, that the children would re

side primarily

with Ms. Beuerle

in and that Mr. Hayes was

obligated to pay

child su pport in the amount of $600.00 per month. On March 4, 1997, Ms. Beuerlein filed a motion requesting an inc rease in child

support and a judgment in the amount of Mr. Hayes’ alleged child support ar rearage. I

n his answer to the petition, Mr. Hayes deniedthat he was in arrears with respect to his child support obligation. On August 15, 1997, Mr.

### -2-

Hayesfiled a

petition seeking a judgment against Ms. Beuerlein for amounts due under a promissory note executed by

Ms. Beuerlein

in conjunction with the parties’ divorce. After a hearing on these matters on March 3, 1999, the trial court found (1) that Mr. Hayes has an annual income of $64,139.00, (2) that Mr. Hayes’ child support obligation is $1,221.00 per month but that this amount should be reduced to $62 1.00 per month until M s. Beuerlein’s

debt under the pr

omissory note

is satisfied, (3) that Mr. Hayes’ child support arrearag e is equal to $14,940.00, (4) that Ms. Beuerlein’s debt under the promisso

ry note is eq

ual to $39,569.85, (5) th

at, subtracting

Mr. Hayes’ child support arrearage from

Ms. Beuerlein’s debt under the promissory n

ote, the net amount

that Ms. Beuerle

in

owes to Mr. Hayes is $24,665.85 plus ten percent (10%) interest, and (6) that each party shall pay his or her own attorney’s fe es. An order reciting

this ruling, which

added that Mr. Ha

yes’ child support obligation of $1, 221.00 per month is r etroactive to

March 4, 1997, was entered by the trial court on April 9, 1999. This appeal by Mr. Haye s followed.

The issues raised

by Mr. Hay

es on appeal, as w

e perceive them

, are as follows:

I. Did

the trial court err in determining that Mr. Hayes has an annua l income of $64,139.00?

II. Did

the trial court er

r in finding that M

r. Hayes’ child support oblig ation is $1,221.00 per month, that this obligation is retroactiveto March 4, 1997, and that Mr. Hayes’ child support arrearage is $14,940.00?

III. Did

the trial court er

r infailing to awar

d Mr. Hayes

a judgment in the amount of $39,569.85 (the amount that he is owed by Ms. Beu erlein under the promissory

note) plus interest and

attorney’ s fees and in fail ing toallow Mr. Hay es to d eman d pay ment o f the judg ment b y Ms . Beu

erle in?

To the extent

that these issues in

volve questions of f

act, our review

of the trial court

’s ruling is de

novo with a presumption of correctness and thus we may not reverse the court’s factual findings unless they are contrary to the preponderance of the evidence. See, e.g., Randolph v. Randolph , 937 S.W.2d 815, 819 (Tenn. 1996); T.R.A.P. 13(d). With respect to the

court’s legal co

nclusions, however, our

review is de novo with no presumption of correctness. See, e.g., Bell ex rel. Snyder

v. Ica rd, Merril

l, Cullis, Timm, Furen and G insburg, P.A. , 986 S.W.2d 550, 554 (Tenn. 1999); T.R.A.P. 13(d).
Income and Child Support

Mr. Hayesfirst argues that the trial court erred with respect to the calculation of his annual income. Mr. Hayes testified at trial that he is self employed bu

t that he works thro

ugh Hoyt Ha

yes, Jr. Construction (“Hayes Construction”), which is a company o

wned by his br

other. He rece

ives a flat salary from Hayes

Construction in the amount of $2,000.00 per month (or $24,000.00 per year). Add iti ona lly, thr ough his att orn ey, Mr. Hayes conceded at trial that he receives interest income of $672.00 per year, income from a partnership in the amount of $4,831.00 per year, and income from1 Our calculation assumes, as did the calculation of the trial court, that Mr. H ayes is out of town working for Hayes Construction on every Monday thro u gh Friday of the calendar year. Neither party takes issue with the trial court’s use of this assumption.

2 We recognize that

the sum of

$42,051.00, $12,000.00, and $10,008.00 is $64,059.00 rather than $64,139.00. There is nothing in the rec ord, however, th

at explains this $80 .00 discrepancy in the trial court’s

calculations.



### -3- somerental property in the amount of $12,548.00 per y ear. Thus, Mr. Hayes argued at trial and argues on appeal that his annual income is $42,051.00.

In calculating Mr

. Hayes’ a

nnual income, the t

rial court took in

to consi deration certa

in expenses of

Mr. Hayes that are paid by Hayes Construction. Mr. Hayes lives and maintains a home in Brownsville, Tennessee. In the course of his employment with Hayes Construction, however, he is required to travel out of town during the week and on some weekends. When Mr. Hayes is out of town, he uses a

credit card provided by Hay es Construction to pay for his lodging, meals, and transportation expenses. It is a greed by the parties that th

e amount of Mr. Ha

yes’ lodg ing, meals, and transportation expenses while he is working out of town f o r Hayes Con

struction is approximately

$50.00 per day. Multiplying this amount by five days per week, four weeks per month, and twelve months p er year, t he total amount pai

d by Hay es Construction for

Mr. Hayes’ lodging, meals, and transportation expenses is $12,000.00 per year. 1 HayesCon str uct ion als o pa ys to Mr. Hayes$834.00 per month (or $10,008.00 per year) as reimbursement for pay ments made by Mr. Hayes for

the lease of two trucks, a Ford F-150 and a Ford F-250. One of these trucks is leased by Mr. Hayes for $480.00

per month (or $5,760.00 per year) while the other truck is leased by Mr. Hayesfor $354.00 per

month (or $4,248.00 per year). Additionally, one of the leased trucks is used exclusivel y by M r. Hayes f or personal and b

usiness purposes w

hile the other truc

k is used as a service vehicle for

Hayes Construction. The trial court de termined that Mr. H

ayes’ ann ual income is $64,139.00 rather than $42,051.00 as suggested by Mr. Hay es. Thus, the court

i ncluded in Mr. Hayes’ annual income the $12,000.0 0 per year paid by Hayes C onstructi on for Mr. Ha yes’ lodging, meals, and transportation expenses and the $1 0,008.00 per year paid to Mr. Hay es by Hayes Construction for th

e lease of the two

trucks. 2

Section 36-5-101 of the Te nnessee Code Anno

tated provides tha

t, when ruling on m

atte r s of child support, the c

ourt is instructed t

o follow the guide

lin es pr omulgated by the Tennessee Department

of Human Services. See Tenn. Code Ann. § 36-5-101(e)(2) (Supp. 1999); Herrera v. Herrera
, 944 S.W .2d 379, 386 (Tenn. Ct. App. 1996). Chapter 1240-2-4-.03 of these guidelines provides in pertin

ent part as follow

s:

Gross income shall include all income from any source (befor e t axes and other deductions), whether earned or unearned, and include s but is not limited to, the following: wages, salaries, commissions, bonuses, overtime payments, dividend s , severance pay, p ensions, interest , trust income, ann

uities, capital g

ains, benefits receiv ed from the Social Securit y Administra

tion, i.e., Title I

I Social Secur

ity3 Pursuant to Rule 4 of the Rules of the Tenne ssee Supreme Cour

t, the unreported cases cited in this opinion are of only persuasive authority as to the issues raised by the parties in the case at bar. See Tenn. Sup. Ct. R. 4(H)(1) (amended 1999).



### -4- bene fits, workers compensation benefits whether tempora ry or permanent, judgment s recovered for personal inju

ries, unempl oyment insur ance benefits, g

ifts, prizes, lottery winnings, alimony or maintenance, and income f ro m self employ

ment. Inco me from self employment includ es income from business op erations and rental properties, etc., less reasonable expenses necessary to produce such income. Depreciation, home offices, exce ssive promotional, excessive travel, excessive car expenses, or excessive personal expenses, etc., should not be considered reaso nable expenses. “In kind” remuneration must also be imputed as income, i.e., fri nge benefits such as a company car, the value of on-base lodging and

meals in lieu of BAQ and BAS for a military member, etc.

Tenn. Comp. R. & Regs. ch. 1240-2-4-.03(3)(a) (1994)(emphasis added).

After reviewing the

language of Chapter 1240-2-4-.03(3)(a), we agree with Mr. Hay es that the trial court erre

d when calculati

ng his income. First, we

do not think that the t

rial court should have inc lud ed as inc ome the lod ging , me als , an d tr ans por tat ion exp ens es t hat are p aid by H ay es Construction. These expenses areincurred by Mr. Haye s apart from and in addition to the cost of maintaining his home in Brownsv ille. Thus, the payment

of these expenses by Hayes Construction does not result in any significant benefit to Mr. H ayes. It is undisputed that Mr. Hay

es is self employed. Chapter 1240-2-4-.03(3)(a) provides that income from self employmen t includes all income less the reasonable expenses of producing the income. See Tenn. Comp. R. & Regs. ch. 1240-2-4-.03(3)(a) (1994). Chapter 1240-2-4-.03(3)(a) further provides that

the term “reaso

nable expenses”

does not include e

xcessive travel, s

uggesting tha

t income from self employ

ment should be reduced by

th e expenses of t ravel if the trav el is not excessive a

nd the travel is ne

cessary to produce the income. See Tenn. Comp. R. & Regs. ch. 1240-2-4-.03(3)(a)(1994). There is nothing in the record suggesting that $50.00 per day for lodging, meals, and transportation expenses incurre d while out of town on busine

ss is u nreasonable or that the travel of Mr. Hayes is in any way excessive. Thus, if Mr. Hay es had chosen not t

o usethe credit card provided by Hayes Construction and had instead claim

ed these lodgin

g, me als, and transportation expenses as the expenses of producing the in

come that he rec

eives from Hay

es Construction, it i

s clear that Chapter

1240-2-4- .03(3)(a) would allow for a reduction when calculating his income. See Farmer v. Farmer , No. 01- A-01-9411-CH-00548, 1995 WL 458985, at *2-3 (Te nn. Ct. App. Aug. 4, 1995)(holding that the evidence did not preponder ate against the

trial court’s fin

ding that the fat

her’s monthly

income for purposes of calculating

his child support obl

igation was equa

l to $5,000.00, the a

mount th a t he withdrew each month from hi s business, mi

nus $1,250. 00, the amount of travel expenses that he incurred each month in connectionwith the business). 3 Ms. Beuerlein notes that Chapter 1240-2-4- .03(3)(a) specifically

states that income

also includes “in

kind” remuneration such as “the value of4 Ms. Beuerlein testified at trial that Mr. Hayes leases a Ford F-150 truck and a Ford F-250 truck and that the lease payments with respect to these trucks is $480.00 per month and $354.00 per month. There is nothing in the record, however, from which we can determine which of these trucks corresponds to which of these lease payments. Additionally, there is nothing in the record identifying which of the trucks was used as a service vehicle by Hayes Constructionand which of the trucks was use

d exclusively by Mr

. Hayes. We ther

efore are una

ble to recalcula

te Mr. Hayes’ annual income and must remand the cause so that the trial court can make findings of fact regarding these matters. See Tenn. Code Ann. § 27-3-128 (1980).



### -5- on-base lodging and meals in lieu of BAQ and BAS for a military member.” Tenn. Comp. R. & R egs. ch. 1240-2-4-.03(3)(a) (1994). The nature of on-base lodging and me als, however, is distinct l y different from the nature of l o dging and meals associated with travel. An individual that is in the military r eceive s lodging and meals, or an allowance in lieu thereof, as part of his or her compensation. When an individual lives in on-base lodging

, there is no need

for that individua

l to also maintain a separate off-base residence. In the ca se at bar, Mr. Hayes incurred lodging, meals
, and travel expenses,

as well as the expense of maintaining his home in Brownsville, dur ing t he d ays that he was out of town a

nd working for H

ayes Constr

uction. Thus, unlike an individual in the military who lives in on-base lodging, Mr. Hayes did not receive compensation as a result of the payment of his travel expenses by Hayes Construction. We therefore conclude that the languag e in Chapter 1240-2-4-.03(3)(a) relied upon by Ms. Beuerlein does not re quire us to hold that the payment of Mr. Hayes’ lodging, meals, and transportation expenses by Hayes Construction resulted in income to Mr. Hay

es.

We also do not think that the trial court should have included as income the amount that Hayes Construction pays to Mr.Hayes every month in connec tion with its use of one of the trucks leased by Mr. Hayes. I

t is undisputed that this truck is used exclusively by Hay es Construction as

a service vehicle. Mr. Hayes d oes not receive a

ny benefit f

rom the monthly

payments ma

de to him by Hayes Construction f

or the use of this truck, as the entirety of these pay ments is used by Mr. Hayesto satisfy

his obligations under the lease that applies to this vehicle. We therefore conclude that the payments made to Mr. Hayes by Hay es Construction to r

eimburse him for the lease p

ayments made by Mr. Hayes in

connection with his lease of the service vehicle should not be considered when calculating Mr. Hayes’ annual income. As stated above, Mr. Hay es also leases a second truck which is used exclusively by Mr. Hay es for both personal and business purposes. We agree with Ms

. Beuerlein that the trial court properly included as income the amount tha t Ha yes C ons tru cti on p ays to Mr. Hayesevery month in connection with this vehicle. Chapter 1240-2-4-.03(3)(a) provides that income includes the value of

fringe benefits such as the use of a company car. See Tenn. Comp. R. & Regs. ch. 1240-2-4-.03(3)(a) (1994). The truck used exclusive lyby Mr. Hay

es is equivalent to

a company car in that he

is reimbursed for

the cost of leasin

g this truck and is

permitted to

use the truck for both personal as well as business purposes. We therefore conclude that the amount pai

d eachmonth to Mr. Hayes by Hay es Construction to rei

mburse him for the c

ost of leasing this truck must be considered when calculating Mr. Hayes’ annua l income. 4

Mr. Hayes also

complains t

h at the trial court should not have increased his child support

### -6-

o bligation retroactively to March 4, 1997, the date on which Ms. Beuerlein filed he r petitio n requesting an increase

in child support, wit

hout also requiring Ms. Beuerlein to pay interest on the amount of the payme

nts under the promissory note that she failed to make during the two y ears that elap sedbetween the filing of Ms. Beuerlein’s petition on March 4, 1997 and the hear ing tha t occurred on the petition on March 3, 1999. Section 36-5-101 specifically provides that an order for child support “shall not b

e subject to modific

ation as to

any time period or any

amounts due prior
to the date that an a

ction for modifica

tion is filed and noti

ce of the action h

as been mailed to t

he last known address of the opposing parties.” Tenn. Code Ann. § 36-5-101(a)(5) (Supp. 1 999). This language suggests that an order of child support is subject to modification as to any time period after the f iling of an action for modification. See Brooks v. Brooks , 992 S.W.2d 403, 408 (Tenn

. 1999)(providing that the child suppo rt ordered by

the court shall

be effective

as of the date that the mother filed her petition

for modification) ; Rutledge v. Barrett , 802 S.W.2d 604, 606 (Tenn. 1991)(recognizingthat, under section 36-5-101(a)(5), modification of a child support order may be made only after the commencement of an action fo r modific ation and the givin g of notic e). We thereforeconclude that, be cause Ms. Beue

rlein filed a peti

tio n requ esting an increase in child support

on M a rch 4, 1997, it was within the trial court’s discretion to apply its ruling retroactively to that date. With respect to Mr. H ayes’ con tention th a t the trial court sh ould have also re

quired Ms. Beuerlein to pay interest on the amount of the payments that she failed to make to Mr. Haye s during the pendency of

her petition, we think that this matter was also within the discretion of thetrial court. Almost two years e

lapsed between t

he fil ing of Ms. Beuerlein’s petition and the hearing that occurred on the petition. This delay was due in part to a dispute that arose between the parties during the cou rse of d isc ove ry. Ms. Beuerlein submitted a series of interrogatories to Mr. Hayes reg arding his income . Mr. Hayes refused to answer the interroga tories, prompting Ms. Beuerlein to f ile a motion to compel discovery. The trial court granted the mot ion and ordered Mr. Hay es to fully respondto Ms. Beuerlein’s interrogatories. Ms. Beuerlein subsequently filed a petition for contempt alleging that Mr. Hayes had failed to comply with the c ourt’s order. After a

hearing on the petition, the trial court entered an order once again directing Mr. Hay es to fully respond to the interrogatories submitted to him by Ms. Beuerlein. Mr. Hayes’ fa ilure to respond to Ms. Beuerlein’s interrogatories and failure to comply with the trial court’s order compelling disco

very serve

d to delay the resolution of Ms. Beuerlein’s petition requesting an increase in chil

d support. Under th

esecircumstances, we conclude that the trial cour t did not abuse its disc

retion in not requi

ring Ms. Beuer

lein to pay in

terest

on the amount of the payments under the promissory note that she failed to m ake to Mr. Hayes during the pendency of her petition.

Promissory Note

At the time of their divorce, the parties agreed that Mr. Hay es would pay child support to Ms. Beuerlein in the amount of $600.00 per month. The parties further agreed that Ms. Beuerlein wo

uld repay Mr. Hayes for the cost of her education, which was obtained during the marriage. Consistent withthis agreement, Ms. Beuerlein execu ted a promissory note under which s

he was required

to make installment payments to Mr. Hayes in the amount of $584.77 per month

until this obligation

was satisfied. It was decided by the parties that, instead of writing two separate checks each month, Mr. Hayes would remit a check to Ms. Beuerlein each month in the amount of $15.23, the dif ference

### -7-

between Mr. Hayes’ $600.00 per month child support obligation and Ms. Beuerlein’s $584.77 per month obligation under the p romissory note. In his petition, Mr. Hay es sought a judgment for $39,569.85, the full amount remaining under the promissory note. The trial court did not grant a judgment to Mr. Hayesin that amount, but instead fashioned a payment arrangement similar to the

one previously

agreed to by the parties

whereby Mr

. Hayes wou

ld pay $621.0

0 of his $1,221.00 c

hild support obligation to Ms. Beuerlein each month and the remaining $600.00 of this obligation would

serve as a set-off ag

ainst Ms. Beuerle

in’s indebtedness

under the promissory note. Mr. Hayes argues on appeal that, instead of directing that a portion of his child support obligation should be applied toward the amount that Ms. Beuerlein owes him under the promissory note, the court should have awarded him a judgment for $39,569.85 and allowed him to demand payment of the judg ment.

There is a split of authority among the different states regar ding whether a

court may order that a spouse’s child support obligation should be off-set by a debt owed to the spouse by his or her former spouse. See generally

Claudia Catalano, Annotation, Spouse’s Right to Set Off Debt Owed By Other Spouse Against Accrued Spousal or Child Support Payments , 11 A.L.R.5th 259 (1993). Although there are no re

ported opinions in T

ennessee addre

ssing thisquestion, there are unreported opinions of this Courtsugges ting t hat su ch a pa yment a rrange ment i s not f avore d. In Compton v. Compton
, No. 86-258-I

I, 1987 WL 88

45 (Tenn. Ct. App. Apr. 1, 1987), the divorce court ordered Mr. Compton to

pay $65 0.00 per month in alimony to Mrs. Compton. See id. at *1. During the months of June 1979 to June 1981 , Mr. Compton made a limo ny pa

yments of only $600.00 per month rather than $650.00 per month, resulting in an arrearage of $1,250.00. See id. at *1-2. Mr. Compton claimed, howeve r, that this arrea

rage should be o

ff-set by $

2,007.00 in bills that he had paid for Ms. Compton. See id. This Court held that, because Mr. Compton paid Mrs. Compton’s bills on his own and not at the request of Mrs. Compton, the amount of these bills could not serve
as a set-off again

st Mr. Compton’s alimony arrearage. See id. at *3. In Aubin v. Aubin , No. 88-230- II, 1989 WL 9523 (Tenn. Ct. App. Feb. 10, 1989), the divorce court ordered Mr.Aubin to pay $70.00 in child support to Mrs. Aubin and ordered Mrs. Aub in to pay $6,0

00.00 toMr. Aubin upon the sa le of the parties’ marital home. See id. at *1. After the sale of th e home and the payment of the proceeds of the sale to Mr. Aubin, Mrs. Aubin still owed $1 ,678. 75 to Mr. Aubin. See id. Con seq uen tly, the court reduced the amount of Mr. Aubin’s child suppo rt obligation to

$50.00 per week until the balance of Mrs. Aubin’s debt to Mr. Aubin was satisfied, at which time Mr. Aubin’s ch ild s upport obligation would revert to its original amount of $70.00 per week. See id. at *1, 4. Because neither of the parties challenged the power of the court to order such a set-off pa yment arrangement,

this Court did notdiscuss the matter on appeal. Finally, in Oliver v. Oczkowicz , No. 89-39 6-II, 1990 WL 64534 (Tenn. Ct. App. May 18, 1990), the trial court found that Mr. Oczkowicz owed $9,295.15 in b

ack child support t

o Ms. Oliver but that he was entitled to a credit aga

inst his child support arrearage in the a mou nt of $4,754.65, which included certain expenditures made by Mr. Oczkowicz for the b

enefit of the parties’ children, certain expenses incurred by Mr. Oczkowicz in conjunction wit

h his visitation with the children, and a personal loan that Mr. Oczkowicz had made to Ms. Oliver. See id. at *1-2. On appea l, this Court first concluded that Mr. Oczkowicz was entitled to off-set his child support arrearage by voluntary payments made by him for the children’s necessaries that

were not being provided by Ms. Oliver. See id. at *2. Additionally, however, we concluded

that Mr. Oczkowicz w

as not entitled to of

f-set his child supp

ort arrearage by amounts5 We recognized in Oliver that this conclusion was apparently inconsistent with Aubin but

found that Aubin was distingui sh able from Oliver in that no issue was raised on appeal in Aubin regarding the power of the court to order a set-off of the parties’ personal and child support obligations. See Oliver , 1990 WL 64534, at *2.



### -8- owedby Ms. Oliver to Mr. Oczkowicz that were unrelated to the child sup port orde r 5 because to al low such a set-off “would amount to requiring the children to pay the debts of the custodial parent.” Id. at

*2-3. Finally, this Court commented that the effect of its ruling was not to wipe out the amounts owed by Ms. Oliver to Mr. Oczkowicz but, rather, that Mr. Oczkowicz w ould “have to resort to the ordinary legal processes to collect the debt rather than taking it out of his child support obligation.” Id. at *2.

The promissory note executed by Ms. Beuerlein provides for liquidation of Ms. Beuerlein’s debt in the event of def

ault, as follows: “

In case said

installments, or an

y of th em, are not paid withing fifteen (15) days after same become due, the whole of said principal sum s hall forthwith become due and payable at the option of the holder of this note.” Based on this langua ge in the promissory

note, a nd consistent with this Court’s ruling in Oliver , the trial court should not have ordered that $600.00 of Mr.

Hayes’ mon

thly child support obligation should be applied as a set off against Ms. Beuerlein’s indebtedness to Mr. Hayes. Rather, the court should have g ranted a judgment to Mr. Hayes in the

full amount owed to Mr. Hayes by Ms. Beue rlein under the promissory note. We therefore re

verse the portion of the t

rial court’s ruli

ng providing fo

r a set-off of Mr

. Hayes’ child support obligation against Ms. Beuerlein’s personal debt to Mr. Haye s.

Mr. Hayes also

requested in his petition that he be granted reasonable attorney’ s fees incurred in the prosecution of his claim against Ms. Beuerlein under the promissory

note. The trial co

urt did
notgrant this req uest but instead ruled that each of the parties shall pay his or her own attorney ’s fees. Mr. Hayes argues on appeal that this portion of the trial court’s ruling w

as in error and that the court should have ordered Ms. Beuerlein to pay 15% of his attorney ’s fees.

T he promissory n

ote executed by

Ms. Beuerlein pr

ovides that “[i]n the e

vent of suit t o enforcepayment of this note, a reasonable additional sum shall be allowed as attorney’s fees in such suit, together with all costs of collection and the interest, and be made a part of the judgment therein.” Ms. Beuerlein te stified at trial tha

t, in April of 1997, Mr. Hayes began pay ing her $600.00 per month, the full amou

nt of his child support obligation, rather than paying her $15.23per month and off-setting the remaining $584.77 per month against the $584.77 per month that she was required
to pay to Mr. Ha

yes under th

e promissory

note. Despite

the payment

of Mr. Haye

s’ full child support obligation, Ms. Beuerlein di d not make any

payments to

Mr. Hayes u

nder the promissor

y note. Thus, Ms. Beuerlein was in default of the promissory note. Mr. Hay es fileda petition to enfor ce his rights under the promissory note. As noted above, the promissory note spec ifically providesfor

an award of reasonable attorney’s fees incurred in enforcing payment of the note. We therefore conclude that the trial court should have awarded reasonable attorney’s fees to Mr. Hay es. No proof was presented at trial regar

ding Mr. Hay

es’ attorney ’s fees. On remand, the trial court is instructed to determine the amount of attorney’s fees that were incurred by Mr. Hayes in enforcing his rights under the

### -9-

promissory

note, as opposed to those incurred in defending Ms. Beuerlein’s petition for an increase in child support, and assess a reasonable amount of these fees against Ms. Beuerlein.

Conclusion

Based on the foregoing, we

reverse the trial court’s calculation of Mr. Hayes’ a nnual income, the court’s failure

to grant a judg

ment to Mr. Hay

es in th e full amount of the outstanding amount owedto him by Ms.Beuerlein under the promissory note, and the court’s refusal to grant attorney’s fees to Mr. Hayes. In all other respects, howe ver, the ruling of the trial co urt is aff irmed. On remand, the court is instructed to recalculate Mr. Hayes’ income without regard t o the lodgin g, meals, and tr anspo rtation expenses of Mr. Hayes that are paid by Hayes Construction and the monthly payments received by Mr. Hay

es from Hayes

Construction associated with the truck leased by Mr. Hayes t

hat is used by

Hayes Construction as a service vehicle. Because a recalculation of Mr. Hayes’ income will necessarily alter the amount of

Mr. Hayes’ child support oblig ation and child support arrearage, the

court’s order on remand should recite these altered amounts. The trial court should also grant

a judgment to Mr. Hayes in the full amount of Ms. Beuerlein’s balance under the promissory

note. Finally, the court on remand should determine the amount of attorney’s

fees that

were incurred by

Mr. Hayes i

n enforcing his

rights under the

promissory n

ote and assess a r

easonable
amount of these fees ag

ainst Ms. Beuerle

in. The costs of this

appeal are taxed

to one-half to Ms

. Beue rle in a nd o ne-h alf to M r. H ayes, for whi ch ex ecut ion may i ssu e if nece ssa ry.