Court Opinion

ID: 1070911
Source: CourtListenerOpinion
Date Created: 2013-10-09 19:39:54.944805+00
Date Added: 2024-06-11T12:32:03.310085
License: Public Domain

COURT OF APPEALS OF VIRGINIA

Present: Judges Elder, Annunziata and Frank
Argued at Alexandria, Virginia

ROBERT E. YOUNG, JR.
                                          MEMORANDUM OPINION * BY
v.   Record No. 2380-99-4                  JUDGE LARRY G. ELDER
                                               APRIL 4, 2000
MARY PATRICIA YOUNG

            FROM THE CIRCUIT COURT OF FAUQUIER COUNTY
                  Carleton Penn, Judge Designate

          Julia S. Savage (Walker, Jones, Lawrence,
          Duggan & Savage, P.C., on briefs), for
          appellant.

          Robin C. Gulick (Robin C. Gulick, P.C., on
          brief), for appellee.

     Robert E. Young, Jr., (husband) appeals from a decision of

the Fauquier County Circuit Court (trial court) denying his

request for a reduction in spousal support payments to Mary

Patricia Young (wife), his former wife.   On appeal, husband

contends the trial court erroneously (1) excluded his testimony

about wife's education, employment history and marketable

skills; (2) granted wife's motion to strike at the conclusion of

husband's evidence; and (3) awarded wife attorney's fees.    We

hold the trial court erroneously excluded husband's testimony

and applied the improper standard in ruling on the motion to

     * Pursuant to Code § 17.1-413, recodifying Code
§ 17-116.010, this opinion is not designated for publication.
strike.   Therefore, we reverse and vacate the ruling of the

trial court on all issues and remand for further proceedings

consistent with this opinion.

     The parties separated after twenty years of marriage and

entered into a spousal support and property settlement agreement

on July 24, 1996.   The final decree of divorce, entered August

12, 1996, affirmed, ratified and incorporated the parties'

agreement and paraphrased the terms relating to spousal support,

providing as follows:

           [Husband] shall pay to [wife], as
           maintenance and support, the sum of
           $5,875.00 per month . . . . Said
           maintenance and support payments shall
           terminate upon the death of either party or
           Wife's remarriage, whichever event occurs
           first. Wife and Husband reserve the right
           to petition a court of competent
           jurisdiction to modify the amount of
           maintenance and support based upon a
           significant change of financial
           circumstances of either party.

     At the hearing on husband's request for a modification of

support, husband testified and offered evidence from a

vocational expert about husband's decrease in earning capacity

and wife's increase in earning capacity.   On wife's motion to

strike husband's evidence, the trial court ruled husband "failed

to meet the burden of showing a material change in circumstances

by a preponderance of the evidence" because he bore the risk of

income reduction that came with his job change.   The trial court

expressly did not reach the issue of wife's employability,

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holding that husband was obliged to pay support under the terms

of the parties' agreement and "there's no condition set out in

[the relevant portion of the agreement] that would require her

to seek employment if he voluntarily reduced his income."      The

court then granted wife's request to require husband to pay her

attorney's fees.

     In ruling on a motion to strike at the end of a plaintiff's

evidence,

            the trial court [must] accept as true all
            the evidence favorable to the plaintiff as
            well as any reasonable inference a jury
            might draw therefrom which would sustain the
            plaintiff's cause of action. The trial
            court is not to judge the weight and
            credibility of the evidence, and may not
            reject any inference from the evidence
            favorable to the plaintiff unless it would
            defy logic and common sense.

Austin v. Shoney's, Inc., 254 Va. 134, 138, 486 S.E.2d 285, 287

(1997).   This same standard applies to an appellate court's

review of a trial court's decision to strike the evidence in a

bench trial.    See Claycomb v. Didawick, 256 Va. 332, 335, 505
S.E.2d 202, 204 (1998).

     When a trial court determines the amount of spousal support

to be paid pursuant to Code § 20-107.1, the court retains the

power to modify the award of support.    See Code § 20-109.    A

party requesting modification must prove a material change in

circumstances that warrants modification of support.       See Furr

v. Furr, 13 Va. App. 479, 481, 413 S.E.2d 72, 73 (1992).      The

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material change "must bear upon the financial needs of the

dependent spouse or the ability of the supporting spouse to

pay."     Hollowell v. Hollowell, 6 Va. App. 417, 419, 369 S.E.2d
451, 452 (1988).    "Spouses deemed entitled to support have the

right to be maintained in the manner to which they were

accustomed during the marriage, but their needs must be balanced

against the other spouse's ability to pay."     Floyd v. Floyd, 1
Va. App. 42, 45, 333 S.E.2d 364, 366 (1985).    A spouse seeking

support "is obligated to earn as much as he or she reasonably

can to reduce the amount of the support needed."     Srinivasan v.

Srinivasan, 10 Va. App. 728, 734, 396 S.E.2d 675, 679 (1990).

This requirement flows from the language of Code § 20-107.1,

which "directs the trial court to consider . . . the earning

capacity of the 'parties.'"     Srinivasan, 10 Va. App. at 734, 396

S.E.2d at 679.

        Here, the parties agreed on the amount of spousal support

and did not ask the trial court to make a determination pursuant

to Code § 20-107.1.    Although any modifications to the spousal

support upon which the parties agreed must be made in compliance

with the agreement, see Code § 20-109, the relevant terms of the

parties' agreement here are in keeping with the law which

applies in the absence of an agreement.    Both permit

modification on a "significant" or "material" change in the

financial circumstances of either party.

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     Under the terms of the parties' agreement, we hold the

trial court erred in granting wife's motion to strike husband's

evidence.   First, the trial court erroneously determined that

wife had no duty under the parties' agreement to seek

employment.   Although no express provision of the agreement

required wife to seek employment, the agreement specifically

permits modification upon a change in the financial

circumstances of either party.    Evidence that wife was able to

work and earn an income and that she was unable to do so at the

time the parties executed the agreement would establish a change

in circumstances.   See Pellegrin v. Pellegrin, __ Va. App. ___,

___, ___ S.E.2d ___, ___ (2000) (holding that parties' agreement

upon divorce, under which husband was obligated to pay tuition

for wife's education and was entitled to a reduction in spousal

support payments to wife if she attained a certain level of

income, contained implicit requirement that wife would make

reasonable effort to obtain employment).

     On wife's motion to strike, the trial court was required to

view the evidence and all reasonable inferences therefrom in the

light most favorable to husband. 1   So viewed, the evidence

supported a finding that at the time the parties signed the

separation agreement, wife was a recovering alcoholic who was

unable to work "because of her rehabilitation program and her

     1
       Of course, the trial court would be free to make a
contrary finding after hearing all the evidence.

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admissions for alcoholism."    Wife underwent eight

hospitalizations for her alcoholism between 1992 and 1995 and

attended up to three Alcoholics Anonymous meetings each day.

Husband's vocational expert testified that wife's history of

repeated hospitalization could have affected her employability

after only one year of sobriety.    In contrast, the evidence

established that at the time of the hearing on husband's request

to reduce spousal support, wife was immediately employable in

the Warrenton area in a variety of different positions and had

an initial annual earning capacity of $15,600 to $17,690.    This

evidence required the trial court to deny wife's motion to

strike.

     We hold the trial court also erred in concluding husband's

evidence, viewed in the light most favorable to husband, failed

to prove a material change in circumstances as to his own

earning capacity. 2   So viewed, the evidence supported a finding

that when the parties executed the settlement agreement,

husband's last full year of income from his medical practice in

1995 was $366,000--$352,000 in earned income and the remainder

from rental of the practice's office building--and that his

income at the time of the settlement agreement in 1996 was on

track with his 1995 earnings.    His job-earned income for all of

     2
       Again, the trial court would have been within its
authority to reach these conclusions after hearing all the
evidence.

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1996, while he was still in private practice in Warrenton, was

$265,000, a reduction of $87,000 from the previous year.      This

was also a reduction of $65,000 from the 1993-to-1995 average of

$330,000.   Husband testified that this decline resulted from an

increase in competition among area obstetricians, changes in

healthcare reimbursement rates and various other causes, and was

one of several factors motivating his departure from the

practice and his move to Michigan.     After his arrival in

Michigan, his income decreased further due in part to changes in

federal law for medicaid reimbursement.    Husband's vocational

expert testified that the average income range in Adrian,

Michigan, for obstetricians of husband's level of experience was

comparable to or greater than the average income range in

Warrenton, Virginia.   By the time of the hearing on husband's

request for modification of support, husband's salary had

decreased to $200,000 per year.

     In granting the motion to strike, the trial court relied on

husband's income tax returns which showed an increase rather

than a decrease in his gross income between 1996 and the time of

the hearing.   However, husband testified that some of the income

reflected on his tax returns resulted from the tax consequences

to him from carrying out certain requirements of the parties'

property settlement.   Wife rather than husband received a

portion of the funds on which husband was taxed, thereby

artificially inflating the annual income listed on husband's tax

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returns.   Also, other non-salary portions of his income resulted

from the forced sale of assets he received in the equitable

distribution, which could not be counted in their entirety as

income to him.   See Barker v. Barker, 27 Va. App. 519, 529-30,

500 S.E.2d 240, 245 (1998) (holding that earnings on assets

received in equitable distribution must be considered in

determining spousal support but that it is error to consider

assets themselves as income).

     Therefore, the evidence, viewed in the light most favorable

to husband, supported a finding that wife's earning capacity had

increased materially and that husband's earning capacity had

decreased materially, through no fault of his own, since the

parties entered into the spousal support agreement.   For these

reasons, we hold the trial court committed reversible error in

granting wife's motion to strike.

     Husband also contends the trial court erroneously excluded

portions of his testimony on wife's employment history and

marketable skills.   We agree.   A trial court's refusal to admit

evidence is reversible upon a showing of an abuse of discretion.

See Blain v. Commonwealth, 7 Va. App. 10, 16, 371 S.E.2d 838,

842 (1988).   As set out above, wife's ability to earn an income

was relevant to establishing whether a material change in

circumstances justifying a modification of support had occurred

since the parties executed the property settlement agreement

and, if so, in determining wife's current earning capacity.     See

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Srinivasan, 10 Va. App. at 734, 396 S.E.2d at 679; Hollowell, 6

Va. App. at 419, 369 S.E.2d at 452.       Any marketable skills and

abilities wife demonstrated during the marriage, absent evidence

she no longer possessed those skills or abilities, were

probative of her earning capacity at the time of the hearing.

Therefore, the trial court abused its discretion in excluding

husband's testimony on wife's ability to quilt and smock and her

successful operation of a horse training business.

     Husband also challenges the trial court's award of

attorney's fees to wife.   Because we reverse and vacate the

trial court's ruling on wife's motion to strike, we also vacate

the award of attorney's fees. 3

     For these reasons, we hold the trial court erroneously

excluded husband's testimony and applied the improper standard

in ruling on the motion to strike.        Therefore, we reverse and

vacate the ruling of the trial court on all challenged issues

and remand for further proceedings consistent with this opinion.

                                      Reversed, vacated and remanded.

     3
       This ruling does not preclude the court from entertaining
another request for attorney's fees if wife prevails on remand
following a hearing on all the evidence.

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