# FILED
May 21, 1997 Cecil W. Crowson Ap pellate Cou rt Clerk JAMES DOY LE RUST, II, ) ) Plaintiff/Appellant, ) ) Appeal No. ) 01-A-01-9608- CH-00361 VS. ) ) Rutherford Chancery ) No. 90DR-360 KAREN RUTH WAX RUST ) GERBMAN, ) ) Defendant/Appellee. )

COURT OF APPE ALS OF TENNESSEE MIDDLE SEC TION AT NASHVILLE

APPEALE D FRO M THE C HANC ERY C OURT O F RUTH ERFOR D COU NTY AT MURFREES BORO, TENNESSEE THE HONORABLE ROBERT E. COR LEW, III, CHANCELLOR

RONALD L. STONE 6th Floor, 211 Printers Al ley Nashvil le, Tennessee 37201 Attorney for Plaintiff/Appellant BRAD W . HORNSBY (At trial) JAY B. JACKSON (On appeal) BULLOCK, FLY

& McFARLIN 301 N. SpringStreet P. O. Box 398 Murfreesboro, Tennessee 37133-0398 Attorney for Defendant/Appellee

AFFIRMED AND REMAN DED

BEN H. CAN TRELL, JUDGE
CONCUR: LEW IS, J. KOCH, J. 

## O P I N I O N- 2 - Mr. Rust experienced a dramatic decline in income after his divorce, and petitioned for a reduction in hi s child suppor t obligati on. Follow ing a leng thy course of litigat ion, the tria l court redu ced his obli gation from $1,500 p er month to $690 per month, and made th e reduct ion retroact ive to the d ate he petitioned for the modification.

Mr. Rust appealed, arguing that even this drasticall y reduced obl igation
was in e xc ess of the presumpt ively correct amount to be awarded under the child support guidelines . His former wife’s posi tion on appeal was that it was error to order any reduction at all in child support, because the husband was willful ly underemployed. Other iss ues on appeal inv olved the modi fication o f the alimony
awa rd, t he conduct of the w ife’s attorney , and a finding of contempt against the husband. W e affirm the trial court in all respect s.
I. The Proceedings

In October of 1989, James Doyl e Rust

left th e mari tal hom e that he had shared with Karen Rust. The couple had three young chi ldren, one of w hom had been born in March of that s ame year. M rs. Rust fil ed a petition for child suppor t, and
an agreed order

was entered on July

10, 1990, whi ch obligated Mr. Rust to pay $1500 per month in child s upport, to prov ide medical insurance for M rs. Rust and the three children, and to pay all their uninsured med ical and dental expenses.

Mr. Rust quickly fell behind on his child support obligation, and Mrs. Rust filed a petition for contempt and for judg ment on the arrearag es. The petition was still pending w hen the wife fil ed for divorce on October 16, 1990.

The partiessubsequently entered intoa Marital Dissoluti on Agreement, which was incorporated into the Final Dec ree of Divor ce, filed Marc h 19, 1991.- 3 -

Divorce was granted to the wife on the ground of irreconcilable dif ferences, and child support was set

at $1,200 per month. The contempt case and d ivorce complaintwere consolidated for the purpose of reso lving all the pendin g issues in a single pro ceedin g. A judgment against Mr. Rust for the child s upport arrear age in theamount of $7,192
was made a part of the decr ee , b ut execution on the judgment was stayed pending continuing p ayment on the obl igation of $100 per month.
Further litigation followed, largelyinvolv ing vi sitation and schooling for the children, the details of which it is unnecessar

y to reci te here, exc ept insofar as the court’s order resol ving tho se issuesalso modified Mr. Rust’s support obligations once again.

The court ordered that ch ild support again be increased t o $1,500 per month. Because of a phy sical condi tion that made it difficult for Mrs. Rust to obtain medical insurance, M r. Rust’s insurance obl igation asto her w as replaced w ith a requirement

t hat he pay

her $150 per month for sixty months. The court later characteriz ed this oblig atio n as a limo ny. Mr. Rust was order

ed to continue to provide medical insur

ance for his chi ldren.

Mrs. Rust s ubse quen tly rem arrie d and took her n ew h us band’s last
name. Henceforth in this opinion she will be referred to as Mrs. Gerbman. Mr. Rust also remarried. On September 3, 1993, Mr. Rust filed a pro se Pet iti on toMod ify Child Support. He c laimed that his net income, which had been $4,100 per month at the time the prior

support order

was iss ued, had been reduced to $1,300 per month. Mrs. Gerbman answ ered, and filed a counter-petition for cont empt, alleging Mr. Rust’s failure to make monthly pa yments on the j udgment, and on his child suppor

t. She claimed that he was understating his income, and th at he was voluntarily underemployed.- 4 - B oth parties subse quently filed numerous motion s which raised additional issues and l en gt hened the course of theproceedings . After disposi ng of those issues, thecourt issu ed its ruli ng from the bench, and ordered Mrs. Gerbma n’s attorney to draft the order . Mr. Rust’s attorney moved the cour

t to am end the judgment, and the court r esponded to his objecti ons before the amended or der, from which this appeal w

as taken, was finally entered and approved by both couns el. The date was Apri l 30, 1995, more t han twenty months afte r Mr. Rus t filed his pro se petition.

The court reduced Mr. Rust’ s child suppor t to $690 per mon th, an d made the redu ction retroactive to September 3, 1993. The court also reduced the alimony payment (the money prev iously or dered to be paid i n li eu of medical insurance) to $75 per month, retroactiv e to th e same date, but ex tended the period during which it had to be paid to 120 month s, so that the total pay out ($9,000) remained unchang ed.

Giving retroactiv

e effect to these modificat io ns reduced, but d id not eliminate the arrearag es Mr. Rust had accumulated, and the court’s order incl uded a
new schedu le for p aying o ff tho se arrearag es. The court al so found Mr. Rust to be in contempt for having made only one c hild support payment duringthe first four months of 1995, and for failing to comply w ith the court’s or der to attend a seminar for divorci ng parents. The jud ge ordered M r. Rust to s erve four days in the Rutherford County jai l for his conte mpt.

II. Child Support

The Tennessee legi slature has pr ovided speci fic direction to the courts charged with set

ting chil d support, by

ordering that uniform chil d support gui delines- 5 -

be established. See Tenn. Code Ann. § 36- 5-101(e). The g uidelines are promulgated bythe Department of Human Ser vices, and are based on a flat percentage of th e obligor’s net income. By law they create a rebut

table presumptio n that the amount of child support determi ned by an application of the guidelines is the corr

ect amount to be awarded.

In applying th e guidelines , the courts de termine the income of the obligor parentfor the year or

years i mmediately preceding the filing of thepetition for sup port, and find the corres ponding amount of suppor t in the gui deline tables for thatlevel of incomeand the number of children for whom su pport is being s ought. Sincethe obligor is expected to pay future support ou t of future incom e, the rebuttable presumption of correctness o bviouslyindicates a corollary presumption that prior earnings ar

e a reliable predictor of futureearnings.

It is no t easy for the obligor t o attack this corollary (nor should it be ) , since past income is

easier to verify than future inc ome is to predi ct, and since the order remains w ithin th e court’s co ntrol and subj ect to modificati on if future events result in a significant change in the obligor’ s income, or hi s earning capacity.

In the present cas e, the proof showed that although Mr. Rust h ad been able to earn a very good living from the sale of au tomobiles, he frequen tlycame into seriousconflict with his employers. He wor ked for sever al different dealers hips, but his incomewas highe st w hen he was empl oyed a s finance ma nager at Superior Mo tors in Nashv ille. He earned $83,362 duri ng eleven months in 199 2, and mad e timelypaymentson his child suppor t during th at time. Accor ding to Mr . Rust, he had to quit that

job because of stress related t o his employer’s order that he falsify certain entries on the books of the compa ny, and because of a wor sening alcohol problem related to that stress. Bill Proctor, comptroller of Sup erior Motors, denied any- 6 -

wrongdoi ng by the comp any, but confirmed that M r. Rust had a drinking problem that created concern and dif ficulties for the emp loyer.

After leaving Superio r Motors , Mr. Rust changed his line of wor k, and began selling insurance. He earned no i ncome during t he period w hile he wa s being trained. After he acquired his license, he man aged to earn a net i ncome of $13,986 in 1993. Dur ing that year, he fell behind on his c hild support payments agai n, but managed to avo id a t hrea tene d con tem pt by m akin g two payments that amounted to $5,600, from the sale of the house that had bel onged to his p resent wi fe.

Mr. Rust testifie d that when th e book s w ere closed on h is 1994 transactions, he ex pected them to show that he had netted bet ween $18,000 and $20,000. He had acquired some large institutional clien ts, and hoped that commissionsfrom them would result in a 1995 net income between $40, 0 00 and $50,000. However problem s with his new marri age plunged him back into al cohol abuse, and he testified that he had been attend ing an outpatient alcohol rehabili tation program for the five or six weeks pre ceeding the hear ing of April 29, 1995. The program involved at least three three-hour sessions each week. The ef fect of Mr. Rust’s prob lems on his 1995 income was uncertain.

These facts were before the trial court when it ordered that child support be set at $690 per month. Such an award for the su pport of three chi ldren correspondsto an annual income of $25,200 for the oblig or. Both parti es disputed the correctness of the trial court ’s determinati on, but in lig ht of the fluctuations and uncertainty

surrounding Mr. Rust’ s income, w e do not believe the trial court erred.

I n his moti on to alt er or ame nd the c ourt’s ju dgment , Mr. Rust a rgu e d that the only correct way to calculate the retroactive portion of his obligatio n wo uld have been to base it d irectly on his income for

those years. He contended that such- 7 -

a calculation would result in an obligatio n of only about $350per month for 1993, and $550 per month for 1994 . The court’s response to the motion inc luded a finding that Mr. Rust was voluntarily underemployed duri ng th ose years, and that “he had t he capability and capacity to earn more than he asserted.”

M rs. G erbman seize d on this findingto argue that Mr. Rust was not entitled to a ny r eduction at all . She reasoned th at the languag e of Rule 1240-2-4
- .03(d) of the Child Suppor t Guidelines, precluded any downwar

d modification under the facts of this cas e:

If an obligor

is wi llfully an d vol untarily unemployed or underemployed child support shall be cal culated based on a determination of potential inco me, as evidenced by educational lev

el and/or prev ious wor k experie nce.

Since th e earlier or

der of child supp ort was b ased on an income l ev e l that Mr. Rust admittedly ac hieved (and in fact subseque ntly exceeded), Mrs . Ge rbm an argued that as a matter of law, the tr ial court w as not permitted to reduc e his obligation.

We believe t hat both parties have taken to o restrict ive a v iew of the power of the trial court to fashion an equitable or der withi n the constrai nts of the child support guidelines . A finding th at an obligor is volu ntarily

underemployed enables the court to set a chil d suppo rt amount c ommensurate wi th his earnin g capacity rather than his actual earnings. Such a finding obligates the court to as cert ain t hat c apa city; it does not create an automatic determi nation that he re mains capable of earning w hat he has earned in the past.

In the present cas e, there is ev idence that even aside from his difficulties at Superior M otors, the automobi le sales busi ness has been a so urce o f c onstant stress for Mr. Rust, and has wors ened his alcohol problem. Hopefully, the insurance business will offerhim a more stable workin g envir onment, and a reli able income that- 8 -

will be of benefit to h imself and his three young children. In light of the facts i n th e record, we cannot say that the trial court erred in findi ng that at this po int in his n ew career, Mr. Rust’s potential income could only sustain a chil d su pport oblig ation of $690 per month.
III. Alimony

A second issue on appeal involves the alimony payment s that Mr. Rust
was ordered to make in lieu of m edical in surance. The tri al court found that the payments were in the nature of rehabilitative alimony, and tha t the court accordingly retained jurisdic

tion to m odi fy it. As we discussed abov e, the court ch ose only to modi fy the payment sc hedule, and it l eft the si ze of the total obligation unchanged. Once again, both part ies ob jected to the trial court’s action on grounds tha t are diametrically opposed to each oth er.

Mr. Rust arg ued that the pay ments should have been terminated because of the rebuttable p resumption state d in Tenn. Code Ann. § 36-5-101(a)(3), which reads as follows:

(3) In all cases where a person is receiving alimony in futuro and the al imonyrecipient l ives w ith a third p erson, a rebuttable pres umption is thereby raise d that: (A) The third pers on is contri buting to the support of the alimony recipien t and t he alimony recipient therefore does not need the amount of support previous ly awarded, and the court therefore should suspend all or part of the alimony obligation of the former spouse; or (B) Th e third pers on is recei ving s upport from th e alimony recipient an d therefore doesnot need the amount of alimony previous ly awarded and the cour t t h erefore should suspend all or par

t of the alimony obligation of the fo rmer spouse.

Mrs. Gerbman argues

that when the tr ial court modi fied the insurance obligation to make it a fixed number of payments of a fixed siz e, without stating any- 9 -

conditionsor limitati ons on the awa rd, the awa rd was converted in to alimony i n solido, which the court no longer ha d any pow er to modify. Thus, sh e impliedly argues, the court was in er ror in redu cing the monthly payments, and ex tending the length of the payment oblig ation.

The advent of rehabilit ative alimony as a distinct category

of spousal support has add e d complexit y to the pr

oblem of correctl y classi fying an al imony award. Whereas alimony in soli do and alimony in futuro can usua lly be di stinguishe d without difficulty, rehabilitative alimony has some of the characteristics of both. It has
a calculable total value like alimony in solido, but it is modi fiable like al imony in futur o.

In the present case , the trial cour t modified an insur

ance obligat ion of indefinite duration (which, if it was alimony, was alimony in futuro) to an obl igation of limited durati on and fixed total value (which could theoreticallybe considered either reha bilit ative alimony

or alimony

in solido) . Responding to arguments from both sides, the chancellor stressed thepurpose of the origi nal award and the circumstances that made its initial modification necessa ry. Based on these considerations, he concluded that the modifica tion created the kind of temporary support that remained within the jurisdict ion of the courts to adjust as c ircumstances required.

We do notbelie ve the chan cello r erre d in t his d eter mina tion , but we do not adopt the appellant ’s argument that the rebuttabl e presumption found in Te nn. Code Ann. § 36-5-10( a)(3) thereby applies to this case. We note that the terms ofthe statute refer specifica lly to al imony in futur o, not t o reh abil itat ive ali mon y, and that the two forms of

modifiable alimony

are based on oppos ite findings as to the possibili ty of the o blige e spo use b ecom ing ca pab le of provi ding his or her ow n support. Of
course even without the presumption, Mr. Rust was not prevented from asser ting that Mrs. Gerbman’s remarriag e eliminated her need for further spous al support. B ut he did not make that ar

gument, nor is

there any ev idence in the record to suppor t it.- 10 - IV. Contempt

Mr. Rust argues that the trial court erred i n finding him i n will ful contempt and sentencing him to four days in jail, because inabilit y to pay is a defense to contempt. He claims that he was not capable of comply ing wi th the trial court’s or der d uring th e four month period w hen he failed to pay his child support. He at tributed this alleged incapacity to two problems: lackof inco me during the relevant pe riod, and impairmentof judgment due toa deteriorati ng domestic s ituation that pl unged him into alcohol abuse.

Howeve r by his own admiss ion Mr. Rust had some income every month during the relevant period, and we do n ot be lieve that his pe rson al pro blem s, gra ve though they may have been, excused him from the duty to support his children by his former marriage. As for the argument that his alco holis m somehow made hisnoncompliance with the court’s orders inv oluntary, it does not appear to us to be based
on sound reasoningor to be suppor ted by any

precedentor other authority that we are bound to respect.
V. Attorney Disqualification

In the co urse of the prolon ged strug gle betw een the parties, Brad Horn sby, the wife’s attorney filed a motion to t erminate Mr. Rust’s v isitation privileges. The ground was that “rec ently dis covered ev idence” of felon y w arrants against Mr. Rust in Flori da and South Carol ina indicated that Mr. Rust “poses a r isk of flight with the parties’ children.”

In response, Mr. Rust’s attorney fil ed a motion todisqu alif y Mr. Ho rnsb y, arguing that he was

guilty of blatant misrepr

esentation to thecourt. Mr. Rust claimed that as a family fri en d and advisor on financial and l egal matters , Mr. Hor nsby had- 11 -

long been aware of the disputesMr. Rust had with former employers in those states, including their threats t o sw ear out crimi nal warr ants against

him, and that he had specific knowledg e as to the Flo rida war rant at least thirty- one months bef ore he presented it to

the court as “ newly discovered evidence.”

Mr. Rust further c laimed that Mr . Hornsby had th r eatened him wi th criminal prosecution t o get him tosign themarital dissolution agreement, an d that Mr. Hornsby’s prior rel ationship w ith the parti es ga ve him know ledge of confidentia l information about Mr. Rust that should have precluded his subsequent representation of Mrs. Gerbman.

The trial court considered Mr. Rust’s allegations and dismiss ed th e motion to compel Mr. Hornsby to withdr aw. The cour

t found that Mr. H ornsby had not established an attorney- client rel ationship w ith either of the parties pri or to the beginning of the divorce proceedings, and that he had therefore not violated DR 4-101 of the r ule s of the Code of Professi onal Responsib ility in regard to preserv ing the confidences and secrets of a c lient. The court also found that Mr . Hornsby had not violated DR 7-105, w hich prohibi ts using t he threat o f cr iminal prosecution to gain advanta ge in a civ il matter. The court did n ot directly address the question of Mr. Hornsby’s alleged misre presen tation, but pres umably found that M r. Rust did not meet his burden of proof on that i ssue, or that the al legation, i f proven, was not sufficiently grave t o warrant

disquali fication.

We believe t hat it rests within the sound discretion of the trial c ourt to determine whether an an attorney should be disq ualified from appeari ng before it in
a particular

case. That disc retion is r ooted in the cour t’s general powers, found in Tenn. Code Ann. § 16-1-102(4) , to “[c]ontr ol, in furtheran ce of justice, t he conduct of its officers, and all othe r persons connected with a judicial proceeding bef ore it, in every matter pertai ning to the proceedi ng”. The cour t’s decisi on should not be- 12 -

reversed exc ept fo r abuse of that dis cretion. We do not find that the cha ncellor abused his dis cretion, and we according ly affirm his decision.

VI.

At the conclusi on of the opinion w hich preceded h is final order, the chancellor

wrote, “ [i]t certai nly is t he hope of the Court t hat with t h e conclusi on of these proceedings , the bitter di sputes and ill -feelings w hi ch the part ies h ave experienced toward each other will cease. Certainly the lives of the minor children will be enriched by such cessation.” T his court hearti ly concur s. The order of the trial court is affirmed. Remand this cause to the Ch ancery Co urt of Rutherford C ounty for further p roceeding s consistent with thi s opinion. Tax the costs on appe al to the appellant.

_____________________________ BEN H. CAN TRELL, JUDGE CONCUR:

_______________________________ SAMUEL L. LEWIS, JUDGE

_______________________________ WILLIAM C. KOCH, JR., J UDGE