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Recent Case re: Attribution of Income for Child Support and Alimony

Recent Case re: Attribution of Income for Child Support and Alimony

Posted on May 16th, 2017

Alimony and child support determinations are often a hotly contested area within a divorce. Massachusetts has statutes and guidelines in place to help determine these amounts focusing on percentages of income that a party should have to pay. But what happens when a party loses their job? What if they voluntarily leave their current job and decide not to work, or take a lower paying job? In the recent case of Elizabeth Emery v. Thomas Sturtevant these issues were resolved when the Massachusetts Appeals Court ruled that before a court can order that a person has a higher incoming earning potential and should pay alimony and child support at the income potential instead of actual income, a divorce judge must consider that party’s reasonable efforts to seek a comparable paying job.

Facts:

In this case, Thomas worked as a headmaster of a private school earning, at its peak, in excess of $350,000 a year. The job guaranteed by contracts for three years that were periodically renewed. Thomas held this position for seven years from 2003 until 2010 when he resigned after an extramarital affair with a subordinate at the school. Although he was not terminated from his position, and Thomas wasnt sure if it would affect his ability to get a new contract, he resigned stating for personal reasons in May 2011 and received a severance package that included one year’s salary.

A divorce proceeding was held in May of 2012 and in June issued Thomas to pay child support and alimony for more than $3,200 a week. The judge came to this number based off of Thomasseverance pay for the year as well as his consultation work he was doing at the time. Before the order was released in July Thomas secured a job as a headmaster of another private school, but was earning a third of what he used to. He filed a motion to reduce the child support and alimony as he was making significantly less money. The court denied these motions finding that no material change in circumstances had occurred because of his potential and demonstrated earning capacity were higher than the job he took and that it was Thomasvoluntary decision to resign from his higher paying job. Thomas was found multiple times in contempt for nonpayment. Eventually, after a third contempt trial, the judge found that Thomas was in arrears for over $100,000 in alimony but not in contempt for inability to pay. The Appeals court overruled the divorce judge’s ruling and found that the judge failed to look at the reasonable effort taken by Thomas to find comparable work. The appeals court also vacated the contempt rulings as the motions should have never been denied by the divorce judge in the first place.

Attribution of Income and “Reasonable Efforts” Defined

Reasonable effort to find comparable employment is a key element when determining if a person is earning to their potential in Massachusetts. The courts have ruled that a party may have their alimony and child support payments considered at a higher income than they make if the party has taken no reasonable effort to find similar employment. A party cannot take an early retirement or pursue a less lucrative career in an unrelated field and expect to have lower alimony and child support obligations. A court must look at each case and determine if a material and substantial change occurred and see if the party took a reasonable effort to find a comparable job. The judge may not consider the parties conduct during the marriage for determining if one party resigned or lost a job.

In this case, the judge determined that the resignation was voluntary and caused by Thomasextramarital affair, assigning blame to the loss of employment and determined that when he took the lower paying job in the similar field, he should have continued his search for a job that paid similar to his former job. The Appeals Court ruled that Thomas took a reasonable effort to find employment including looking for work around the country, going to job fairs, reaching out to contacts in the field, and even going overseas to China to look for employment. In the end, Thomasreceived one job offer, that he took. The divorce judge, however, believed that is search should have continued while employed to find a similar salary to his previous job. Again, the Appeals Court disagreed with this because they found that over an eleven-month search for a job that resulted in one job offer, Thomas took a reasonable effort to find a similar position with similar pay and won’t be punished by being required to continuously hunt for a job in fear of income attribution.

Reasonable effort to find similar employment is important when factoring in if a motion to modify support and alimony obligations should be altered. A person would be wise to aggressively pursue all job opportunities within their field or matching qualifications if they wanted to minimize the risk of being attributed to a higher income potential. Although a person may want to get out of a field or pursue a more noble calling, they must consider the impact that could have on their obligations.

For more information about child support, click here.

For more information about alimony, click here.

For more information about attribution (imputation) of income, click here.

For more information about modifying a support or alimony order, click here.

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