# FILED
October 1, 199 7 Cecil Crowson, Jr . App ellate C ou rt Clerk IN THE COURT OF AP PEALS OF

TENNESSEE, WESTE RN SECTION AT JACKS ON

_______________________________________________________ ) LAWRENCE EDWARD NORTON, SR. , ) Shelby County Circuit Court ) No. 142777 R.D. Plaintiff

/Appella nt. ) ) VS. ) C.A. No. 02A01-9609-CV-00222 ) BRENDA K

AY NORTON , ) ) Defendant/Appellee. ) )

______________________________________________________________________________ From the Circuit Cou

rt of Shel by C ounty

at Memphis
. Honorable George H. Brown, Jr., Judge

Stuart Br

ian Breakst

one , LAW O FFICE OF DON OWENS, P.A. , Memphis Attorney for Plain tiff/App ellant.
Lee Ann Pafford Dobson , THE L AW OFFI

CES OF JOHN

R. JOHNSON, II

I, P.C. , Memphis Attorney for D efendant/Appellee.

OPINI ON FIL

ED: AFFI RMED AND

REMANDED FARMER, J. CRAWF ORD, P. J., W.S. : (Concur s) INMAN, Sr.J. : (Concur s)This litigation concerns dissolution of a marriage 24ye ars in dur ation. The

appella nt, Lawrence Edward Norton, Sr. (“Husband”), has appe al ed f rom the final decree of divorce, challen ging th

e correctness of the trial court’s decision to award the appellee, Brenda Kay Norton (“Wife”), one-half of his railroad retirement benef its, rehabilitative alimony and attorney’ s fees. For reasons expressed below, we affirm and re mand.

Husbandfiled his complaint for divorce in June 1993 on grounds of ina ppropria te marital conduct

and irreconcilable difference s. Wife filed a counterclaim citing the same grounds and additiona

lly a lleging that Husband had committed adultery. A he aring was conducted on November

15, 1995 with the following evidence adduced: Husband is 44 years of a

ge and wife, 43. Both attained a twelfth grade educ ation and are in good health. Their union produced two children. Their da ughter remaine d a minor ( age 15 ) at the time of tria l.

Husbandhas been e mploy ed with the Illin ois Centra

l Railroa d Company

for 26 y ears. The Company ’s gene

ral fore man, Joaquin Flores , testifie d that Husb and is employ ed as a ma chinist and that his curren

t rate of pay is $16.04 an hour ba sed on a 40 hour work week, for a g ross annual salary of $33,491.52. Flores explained that this figure is based on Husband’s employ men t as a machinist for a full ye ar. He indicated , howeve r, that a t certai n times, Hus band temp orarily serves in other ca

pacities(such asin a mana geria l position) which re

flects a n increa se in

his pay. Flore s testified that during 1995 Husband received a for eman’s rate of

pay to refl ect a t empor ary change in his employment status. Flores stated that Husband was also given manageria l responsibilities for
a time in 1993. At the present time, Flores was not aware of any proposed chang es to Husband’s
curren t position a s a machi nist. From January to Octobe r 1995, Husband’s gross earnings totaled $47,433.23. Husband’s annual earnings for the y ears 1991-1994 were $32,804.69; $38, 947.82; $3 4, 89 3. 20 ; a nd $3 6, 16 2. 74 , r es pe ct iv el y.

Husband’s pension w ith the railr oad cons ists of sev eral pa rts including “Tier I”

and “Tier II” benefits. Tier I r

esembles those benefits to which he would be entitled if covered

by the Social Se cu ri ty A ct, 42 U. S.C. § 401 et. seq. Tier II is supplemental retirement. Husband can receive full retirement benefits at the ag e of 65.1 The majority of this fig ure represents Husband’s retirement whic h Wife lists at approximately $121,000 which, acc ording to exhibit 4, includes both Tier I and Tier I I benefits.
2 Ch il d c us to dy w as aw ar de d t o W if e. Al th ou gh bo th pa rt ie s o ri gi na ll y so ug ht cu st od y, this was never a truly

contested issue. Wife had various occupations during the marriag e. Her highest pay ing job yielded
an hourly rate of

$9.45 an hour. She is presently e mployed at Br

annan’s Snack

Foods earning $7.50
an hour. Her net income is $250 per week. Her benefits include medical insurance and life insurance in the amount of $15,000. There is no retirement plan. Wife does not know whether her various occupations during the marriag e qualify her for social security

benefits.

Wife’s Rule X IV affida

vit list s assets of the parties totaling approximately $140,000, 1 excluding the m arital residence which the parties valued a t $105,000 with a net equity of approxima

tely $50,000. Wife curren

tly r esides in the marit al reside nce with the parties’ children, daughter-in-lawand grandchild. Wifeexpressed a desire to continue living in the marital home until May 19 97 so that she can r

emain wit hin the school distri ct and allow the min or child to gradu ate from her present high school. Afterwa rds, she would like the home sold.

After hearing the evidence, the trial c ourt entered a final decree awarding

the divorce to Wife on grounds of inappropriate marital conduct 2 and dividing the marital estate to include an award of one-h alf of Hu sband’s p ension to Wif e, to be computed as of December 15, 1995. The decreepr ov id es fo r W if e’ s c on ti nu ed re si de nc y in th e m ar it al ho me un ti l J ul y 19, 1997, a t which time the home i s to be listed on the market for sale. Until such sale, it is ordered that the p arties sh all
own the home as tenants in common with eachbeing r esponsibl e for one -half of the mortg age, ta

xes, insurance and all repairs and expenses exceeding $150 per e xpenditure. The decree awards alimony to Wife, to be gin aft

er the r eal estate clos i ng, in the amount of $400 per month for two y ears and $250 per m onth for a n additional two years the reafter. I n establishing Husband’s annual income, the decree reflects the trial cour t’s finding that Husband’s income “has fluctuated g reatly for the 1995 tax year” and its imputation to Husband of “a rbitrary”annual earnings of $41,000.

Husband i dentifie s the issue s on appe al as foll ows:I. Whether the trial court erred in awarding Wife one half of Husband’s railroad retirement where the Railroad Retirement Act

of 1974 . . . , 45 U. S.[C]. §§ 231d( c)(3), 231m prohi b its b enefits resulting from empl oym ent durin g marr

iage to b e considered community

property subject to division in the event of dissolution of the marriage. 2. Whether th

e tria l c ourt erred in ordering Husband to pay alimony to Wife including paying the mortgage on the marital residencewhere Wif

e curre ntly lives and orderin g th at the marital residenceshall not be put up for sale until July 1 997 and in

ordering Husband to pay alimony

to Wife for four ye ars aft er the sale of the marital residence where Wife, by living in the marital residence, has control over how and under wh at circumstances the house will be sold, and t

hat it is in her best in

terest f or the hou se not to se

ll. 3. Whether

the trial court abused [its] discretion in awarding a substantia

l attorne y f ee to Wife when there was no showing by Wife of ne ed an d n o s ho wi ng by H us ba nd of ab il it y to pa y.
With respe ct to his first issue, Husband argues that the Railroad Retirement Act of 1974, 45 U.S.C. § 231 et. seq. , (“Act” ), speci fically prohibits t

he divisio n of his retirem

ent benefits (Tier II ) as a marital asset. He relies upon the United States Supreme Court decision, Hisquierdo
v. Hisquierdo , 439 U.S. 5 72 (1979) , to support his position. Hisquierdo holds that upon the divorce of the railr oad emplo ye e, his retirem ent benefits are

not to be considered as marital property subject to division. Hisquierdo , 439 U.S. at 583-87. At the time Hisquierdo was deci d ed, the following provision found at 4 5 U.S.C. § 23 1m was in effect:
[N]otwithstanding any other law of the United States, or of any State, te rr it or y, or the Dis trict o f Colu mbia, no annuity or supplemental annuity shall be assignable or be subject to any tax or to g arnishme

nt, atta chment , or other legal process under a ny circumstanc es whatsoever, nor shall the pay ment thereof be anticipated[.]
Hisquierdo , 439 U.S. at 576.

In 1983, § 231m was amended to add subsections (b)(1) and (2). Subsection (b)(2)
curren tly r eads:

This section shall not operate to prohibit the c harac terization or treatment of that portion of

an annuity under

this subch apter wh

ich is notcomputed under section 231b(a), 231c(a), or 231c (f) of this title, or any porti on of a supplemental annuity under this subcha pter, as community

property for

the p ur poses of, or property subject to,3 Sections 231b(a), c(a) and c(f) r elate to the computation of annuities for the individual emp lo yee, th e sp ous e or sur vi vor in ter ms of T ier I or “ soc ial sec uri ty” r eti rem ent ben efi ts . In other words, these provisions apply to those who are entitled to draw upon the individual’s railroad earnings, as in the case of social security

benefits, and to have their annuities computed ac co rd in gl y. distribution in accordance with acourt de cree of

divorce , annulme

nt, or legal separation or the terms of any court-approved prop ert y settlement incident to any such c ourt decree. The Board shall make pay ments of such po

rti ons in accordance with any such characterizatio n or trea

tment or a

ny s uch decree or s ettlemen t. 3

The foreg oing ame

ndment and its effect

upon the decision rendered in Hisquierdo
was address ed by

the West Vi

rginia Supreme C ourt of Ap

peals in Pearson v. Pearson , 488 S.E.2d 414 (W.Va . 1997) a s follows:

Retirement

benefits for railroad employ ees are gov erned by federal statute. As a railroad employee the defendant, upon retirem ent, is en titled to be

nefits under the Railroad Retirement Act of 1974, (hereinafter the “Act”) 45 U .S.C. § 231 et seq . The Act’s scheme provides for two tiers of bene fits which resemble both a private pension program and a

social welfare plan. Tier I benefits ar e equivalent

to th ose the employee

would receive if covered by the Social Security Act, 42 U.S.C. § 40 1 et seq . See 45 U.S.C. § 231 a(a)( 1) and § 231b(a)(1). Tier I I benefits are suppleme

ntal annuities which, like a private pension plan, are tied to earnings and career service. See 45 U.S.C. § 231a(b) and § 231b(e).

. . . . In Hisquierdo v. Hisquierdo , 439 U.S. 572, 99 S.Ct. 802, 59 L.Ed.2d 1 (1979) the United States Supreme Court considered whether an award of railroad retirement benefits to a spouse when dividing marital assets upon divorce was prohibited by the Act. The United States Supreme Court held that 45 U.S.C. § 231m specific ally prohibited the division of benefits paya ble under the Act as propert

y in a divorce. However, in 1983, Congre ss provided an amend ment to § 231m whic h expressl

y pe rmits chara cterizat

ion of Tie r II benefit s as propert

y su bject to d istributio n upon div orce. S ee 45 U.S.C. § 231m(b)(2 ). Not withstand ing the 1 983 amend

ment, the holding in Hisquierdo is still con

trolling with resp ect to Tie

r I be nefits.

Pearson , 488 S.E.2d at 421-22 (footnotes omitted).

Th e Ohio Cou rt of Appeals in Tarbet v. Tarbet , 647 N.E.2d 254 (Ohio Ct. App. 1994), reached the same conclusion when holding tha t the 1983 amendment “removed the shield that [§ 231m] had provided to the treatment of certain railroad retirement benefits as marital property .” Tarbet , 647 N.E.2d at 256. In noting that the shield remains intact for those Tier I benefits ac quired4 Section 231a(c)(1) provides in part, that an individual’s spouse is eligible for annuities “if - (I) such individual (A)is entitled to an annuity under subsection (a)(1) of this section . . . . “ by the railroad empl oyee, Tarbet concludes, in reliance upon Hisquierdo , that the ir indivisi bility does not allow the divorce court to consider or offset their pre sent market value in dividing the marital estate. Id
. Accord Pearson , 488 S.E.2d at 423. Contra Mahoney v. Mahoney , 681 N.E.2d 852, 856 & n.9 (Mass. 1997).

Husband also directs our attention to the following languag e found at 45 U.S.C. § 231d(c)(3):

Th e enti tlement of the spouse

of an indi vidual to a

n annuity under section 231a(c) of

this t itle shall end on the last day of the month preceding the month in which . . . (B) the spou se and the individual are absolutely divorc ed. . . .

The “historical no te” to § 231d i ndicates that subsection (c)(3) was amended in 1981 to add the following provision:

The en titlement o f the divo rced wif e of an individual t

o a n annuity under section 231a(c) of this title shall end on the last day of the month preceding the month in which (A) the divorcedwife or the individua l dies or (B) the d

ivorced wife re marries
.

Section 231a(c)identifie s those “[s]p ouses eli gible f or annuit ies.” Subs ection (4) reco gnizes a “divorc ed wife’ s annuity

” upon the

meeting of cert ain condi tions.

Based upon this Court’s interpretation of the plain language of the Act, we find that § 231d specifically r

efere nces those ann

uities “under § 231 a(c)” which, in turn, concerns those annuities provided under 231a(a)(1) 4 or the ra ilroad e mplo ye e’s “social security ” retirement (Tier I), not supplemental annuities (Tier II ). On the other hand, § 231 a(b) pe rtains es pecially

to those “[i]ndividua

ls eligible for

supplemental annuities.” Section 231(b) relates to the “[c]omputation of annuitie s.” Secti on 231b(a )(1) sta tes:

The annuity

of an indi vidual und

er sect ion 231a( a)(1) o f thistitle shall be in an amount equal to the amount (beforeany reduction on account of age and bef ore any deductions on account of work) of the old-age insurance benef it or disability insurance

benefit to which such ind ividual wo

uld have b een entitled unde r the Soci al Secur

ity Act . . . .

We conclude that no error was committed by the trial cour t in dividing Husband’s Tier II retirement benefits as part of the marital estate.

Husband’s next issue c oncernsthe trial court’s award o f alimony to Wife. I

t is first argued that the trial court erroneously imputed an annual income of $41,000 to Husband w he n setting alimony. Husband asser ts that his actual gross annualincome is $33,491.52 and that his true monthly net income is $2,12 6. Hu sband’s a ffidavit of income

and expen ses lists to tal monthly expenses of $1,421. Of that figure, $450 is a “projecte d” expense f or rent; a t t he time of

trial, Husbandwas residing with his parents. A dding $52 to this amount to coincide with the award of child support and $383.50 which represents one-half of the monthly mortgag e payment, we arrive at a figure of $1,856.50. Wife’s monthly net income is $1,200. She lists her monthly expenses at approximately $2,000.

The major marital assets of the parties are the marital home and Husband’s pension. Wife correctly

points out that the final decree does not specifically denote an equal division of the proceeds upon sale

of the marital residence. We agree, however , that such division isimplicit within the trial cou

rt’s ruli ng. The

division of

the rema inin g mari tal assets does not indicate that either party was be

nefitted to a much greater extent than the other.

It is Husband’s contention that the foregoing demonstrates a lac k of need for support
on Wife’s be

half and a lack of ability to pay on his par

t. H e argues that such is further evidenc ed by Wife’s possession of over $8,000 in her bank account at the time of

trial. We find the

record to indicate a figure of approximately $5,000, hardly an a

mount to alter the current needs of Wife.

The decision

to award alimony is within the sound discretion of the trial court. Such decision is factua

lly driven and requires a balancing of the factors set forth in T.C.A. § 36-5-101(d). The two most significant factors are need and the ability to pay
. Loyd v. Loyd , 860 S.W.2d 409, 4125 In arriving a t this figure, the court reasoned: As the Court understands the law, the Court is required to make an awar d of child support based on quote, “present earning s.” His present earnings are around $5,000 a month, $6,000 if you a dd them all right. I think that [Wife] acknowl edgesthat this y

ear’s e arning s are unu sual. The y a re not co nsistent w ith prior y ears. On the other hand, I thin

k that the position ta

ken by [Husband] th at his earnings are in the thirties and they are going to be in the thirties in 1996 is not supporte d by

the evide nce unle ss he, numb er one, d ecides t hat he wa nts his earning s in the thir

ties. So the

Court is of

the opinio n that it would not be f air to [Husband] to base the child support and any aw ard on $5,000 a month gross. And on the other hand, it would not be fair to [Wife] and the minor child to base it on the minimum amount of money that he would ear n just as a machinist. Somewhere in the middle, not in the middle, but somewhere in the middle of those two figures should be a benchmark to use . . . . (Tenn. App. 1993). We find the record before us to support the trial court’s award o f alimony considering the vari ous statuto ry factor s at play

and all ot hers relevant. We further find the amount of the awa rd appro priate. Even if

Husband’ s annual e arning s are ashe sugg ests, $33,491.5 2, he still has a monthly income in excess of his expenses, a s we have dete rmined them, unlike Wife. We, however, belie

ve th e fig ure p ropo sed b y H

usba nd is i nade quat

e. Wit h the exc eption of tax year 1991, his annual earnings have consistently exceeded this figure. While we agree that Husband’s 1995 earnings thus far are somewha t inflated and “unusual,” as described by the trial court, we

do not find the imputed figure of $41,000 to be excessive or unsupported by the record. 5

Husband also disputes the manner in which alimony was awa rded. The trial court ordered that the marital home be placed on t he market f

or sale o n July

19, 1997 w ith each

party responsi ble for, inter alia , on e-half of the mortgage payment until said sale and that, ther eafter, Husbandwas to pa

y a limony to Wife in va

rying amou

nts for fo ur y ears. H

usband su bmits that it

is in Wif e’s best in te re st th at th e h ou se se ll la te r r at he r t ha n s oo ne r s o a s t o p ro lo ng he r “ al im on y” award of one-half of the house note. Husband contends that such is possible because of the final decree’s failure

to establi sh the initi a l pri ce for w hich the home should

be listed a

nd who is responsi ble for dete

rminin g the means by

which it is to be sold. This omissio n, Husband insists, affords Wife the opportunity to “intentionally or inadvertently pr

eclude” the home’s sale by se tting an “arbitrary

sales price” or failing to use her be st efforts to ensure a sale.We first note that it does not a

ppear f rom the re cord tha t Husband ’s oblig ation topay one-half of the mortgage pay

ments was meant as alimony to Wife. The final decr ee does not identify these payments a s alimony. The better reasoning is that these

pay ments wer

e to assist and bene fit bothparties in preser

vation of a marita l asset. Husband suggests that if there is a dec line in the real estate market and the home’s fair market value decr eases by July

1997, then Wife has enjoyed the additional benefit of continued residency there. We find that

any decline in the home’s value places the parties a

t equal r isk, with the excep tion of Wife ’s ability to remain in the home for an additional periodof time. It is clear from the record, however, that such was orde red prima rily for the b enefit of the parties’ minor child, which certainly Husband cannot seriously question. In any

event, we agree with Wife that, should the situation arise where Hus band has leg itimate reason to question Wife’s efforts in selling the home, he would be entitled to seek further remedies available to a

tenant in common. Moreover, the final decree does not require Husband to agree to a sale of the home for
an “arbitrary ” or

inadequa te price ; nor doesit prohibit Husband’ s own eff

orts to sell the home. Any improprie ty b y e ither pa rty can be r emedied in the tria

l court.

Husband’s final issue concerns the trial court’s award of attorney’s f

ees. In making the award, the trial

court found that th

is litiga tion “didn ’t have t

o ta ke as long as it did” and that Wife’s “position

in this matte

r, was exceeding ly

more reasonable given the facts and the state of the law as the Court understands it . . . .” After reviewing the r ecord, we agree

with the trial cou rt’s observa tion and conclude, especially in light of the economic circumstances of these pa rties, tha t attorne y’ s fees we

re prope rly awarde d. This issu e is withou t merit.
The judgment of the trialcourt is a ffirmed and this c ause

remanded for any

further necessary pr oc ee di ng s. Co st s a re ta xe d t o t he ap pe ll an t, fo r w hi ch ex ec ut io n m ay i ss ue if ne ce ss ar y.

____________________________________ FAR MER , J.

______________________________ CRAWFORD, P.J., W.S. (Conc urs)

______________________________ INMA N, Sr.J. (Concurs)