Rayner v. Rayner

• Decision Date: 15 November 2013
• Docket Number: No. 20120307–CA.,20120307–CA.
• Citation: 316 P.3d 455,750 Utah Adv. Rep. 55
• Parties: Tanja Rodgers RAYNER, Petitioner and Appellee, v. Paul Thomas RAYNER, Respondent and Appellant.
• Court: Utah Court of Appeals

316 P.3d 455
750 Utah Adv. Rep. 55

Tanja Rodgers RAYNER, Petitioner and Appellee,
v.
Paul Thomas RAYNER, Respondent and Appellant.

No. 20120307–CA.

Court of Appeals of Utah.

Nov. 15, 2013.

[316 P.3d 457]

John M. Webster, for Appellant.

George K. Fadel, Bountiful, for Appellee.

Judge MICHELE M. CHRISTIANSEN authored this Opinion, in which Judges GREGORY K. ORME and J. FREDERIC VOROS JR. concurred.

Opinion
CHRISTIANSEN, Judge:

¶ 1 Paul Thomas Rayner (Husband) appeals the trial court's decree of divorce, challenging the trial court's property distribution and alimony award. We reverse and remand.

BACKGROUND

¶ 2 Tanja Rodgers Rayner (Wife) and Husband were married in 1981. They separated nearly thirty years later in January 2010, and Wife filed a petition for divorce later that year. Husband had lost his job in April 2008. After losing his job, he received only minimal income working with a multi-level marketing firm. However, Husband and Wife had stock and multiple retirement accounts, and Husband began liquidating some of these assets after he lost his job and continued to do so during the parties' separation.

¶ 3 After a bench trial, the trial court found Husband to be underemployed and imputed to him an annual income of $40,000. The trial court also found that Husband had dissipated the parties' assets, spending $116,096 “on himself” during 2008, 2009, and 2010.¹ The imputed income and the dissipated assets factored into the trial court's ultimate alimony award and property distribution that accompanied the decree of divorce.

ISSUES AND STANDARDS OF REVIEW

¶ 4 On appeal, Husband contends that the trial court exceeded its discretion by misapplying the law and that its findings of underemployment and dissipation are not supported by the evidence. “The trial court

[316 P.3d 458]

in a divorce action is permitted considerable discretion in adjusting the financial and property interests of the parties, and its actions are entitled to a presumption of validity.” Goggin v. Goggin, 2013 UT 16, ¶ 44, 299 P.3d 1079 (citation and internal quotation marks omitted). However, we will reverse if “(1) there was a misunderstanding or misapplication of the law resulting in substantial and prejudicial error; (2) the evidence clearly preponderated against the finding; or (3) such a serious inequity has resulted as to manifest a clear abuse of discretion.” Id. (citation and internal quotation marks omitted). Furthermore, “we cannot affirm its determination when the trial court abuses its discretion” by failing to enter “specific, detailed findings supporting its financial determinations.” Hall v. Hall, 858 P.2d 1018, 1021 (Utah Ct.App.1993).

ANALYSIS I. Imputed Income

¶ 5 Husband first contends that the trial court's finding of voluntary underemployment was unsupported by the evidence. The trial court stated that the evidence concerning whether Husband quit or was fired for cause was unclear. Therefore, the trial court's finding of underemployment focused on Husband's actions after losing his job. The trial court found that at the time his job ended in April 2008, Husband had an annual salary of about $88,000. Husband “initially made an attempt to find another job.” He was “offered a job” in Nephi for about $40,000 a year, but “he turned that down” because “he didn't want to move” from his home in Bountiful. After his initial efforts, Husband “didn't make any other efforts to find employment.” The trial court also found that Husband “has the ability to work regardless of the health concerns that he has.” The trial court found that the “few hundred dollars a year” that Husband made from his multi-level marketing work—“and sometimes go [ing] in the hole”—did not qualify as reasonable employment. Based on Husband's education and ability, and the availability of the job in Nephi, the trial court concluded that Husband was underemployed.

¶ 6 Husband argues that no evidence supports these findings. He argues that the uncontroverted evidence instead requires the conclusion that he was fired for cause, that he was not actually offered the job in Nephi, that moving or commuting to Nephi was not an option, that his numerous health problems prevent him from working a rigorous schedule or using his left hand, and that his multi-level marketing work provided a viable source of income given his health restrictions.

¶ 7 “When determining the appropriate amount of alimony, a trial court must make findings as to ‘the ability of the payor spouse to provide support.’ ” Fish v. Fish, 2010 UT App 292, ¶ 14, 242 P.3d 787 (quoting Utah Code Ann. § 30–3–5(8)(a)(iii) (LexisNexis Supp.2010)). “In doing so, ‘[a] court may impute income to an underemployed spouse.’ ” Id. (alteration in original) (quoting Connell v. Connell, 2010 UT App 139, ¶ 16, 233 P.3d 836). “[T]he imputation analysis ... involves determining whether the [spouse] is voluntarily unemployed or underemployed and, if so, how much income ought to be imputed.” Busche v. Busche, 2012 UT App 16, ¶ 13, 272 P.3d 748. A spouse is “ ‘voluntarily unemployed or underemployed’ when [he or she] intentionally chooses of his or her own free will to become unemployed or underemployed.” Id. ¶ 16 (alteration in original) (citation and additional internal quotation marks omitted).

¶ 8 In Busche, we recently explained what is required under the first step of the imputation analysis to support a finding of voluntary underemployment following the loss of a job. If the trial court determines that a spouse has been involuntarily terminated, the trial court “must then consider what the [spouse] has done in the aftermath of termination to determine whether he or she has become voluntarily underemployed by virtue of his or her failure to then make reasonable efforts to obtain employment at a pay rate comparable to that of the lost employment.” Id. ¶ 21. In addition to considering the spouse's efforts, the trial court must consider the spouse's “employment capacity and earnings potential.” Hall v. Hall, 858 P.2d 1018, 1026 (Utah Ct.App.1993). Employment capacity

[316 P.3d 459]

involves consideration of the spouse's abilities and limitations, qualifications, experience, and skills. Busche, 2012 UT App 16, ¶¶ 21–22, 272 P.3d 748;Hall, 858 P.2d at 1026. An earning potential determination involves comparison of the spouse's current earnings with his or her historical income, “the prevailing wages for a person with his or her qualifications” and consideration of whether there are jobs reasonably available “in the relevant market for a person with the party's qualifications and experience.” Busche, 2012 UT App 16, ¶¶ 21–23, 272 P.3d 748;Hall, 858 P.2d at 1026. In sum, “a finding of voluntary underemployment must be based on evidence that the party could be earning more with reasonable effort.” Busche, 2012 UT App 16, ¶ 22, 272 P.3d 748.

¶ 9 “Should the court determine that the petitioner is indeed voluntarily underemployed and that imputation is appropriate under the circumstances, it may then proceed to refine the analysis to arrive at a specific amount of income to be imputed.” Id. ¶ 23. Under this second step of the analysis, the trial court must consider the following statutory factors, which “closely align” with the analysis under the first step:

If income is imputed to a [spouse], the income shall be based upon employment potential and probable earnings as derived from employment opportunities, work history, occupation qualifications, and prevailing earnings for persons of similar backgrounds in the community, or the median earning for persons in the same occupation in the same geographical area as found in the statistics maintained by the Bureau of Labor Statistics.

Utah Code Ann. § 78B–12–203(7)(b) (LexisNexis 2012).²

¶ 10 The Utah Code states that in contested cases, “[i]ncome may not be imputed to a [spouse] unless ... a hearing is held and the judge ... enters findings of fact as to the evidentiary basis for the imputation.” Id. § 78B–12–203(7)(a). This statute was amended in 2007 and renumbered in 2008.³ The prior version stated that in contested cases, “[i]ncome may not be imputed to a [spouse] unless ... a hearing is held and a finding made that the [spouse] is voluntarily unemployed or underemployed.” Id. § 78–45–7.5(7)(a) (Supp.2006).⁴ By replacing the language requiring “a finding ... that the [spouse] is voluntarily unemployed or underemployed,” id., with language requiring the judge to “enter[ ] findings of fact as to the evidentiary basis for the imputation,” id. § 78B–12–203(7)(a) (2012), we read the statute as emphasizing the detailed findings of fact necessary to support a decision to impute income, as well as implicitly recognizing that whether a party is voluntarily underemployed or unemployed is really an ultimate fact or a legal conclusion which turns on the subsidiary facts found by the trial court. “Imputation is troubling when the obligor is charged with obligations that he may not be able to pay, even with the best of efforts.” Busche, 2012 UT App 16, ¶ 17, 272 P.3d 748 (citation and internal quotation marks omitted). Indeed, in the alimony context, the imputation analysis is a component of determining the obligor's ability to pay and the recipient spouse's ability to support himself or herself. Fish, 2010 UT App 292, ¶¶ 14, 22, 242 P.3d 787;

[316 P.3d 460]

Willey v. Willey, 866 P.2d 547, 554 (Utah Ct.App.1993). Imputation “cannot be premised upon mere conjecture; instead, it demands a careful and precise assessment requiring detailed findings.” Willey, 866 P.2d at 554. Therefore, the trial court must enter not just a finding of voluntary unemployment or underemployment but specific, detailed findings “as to the evidentiary basis for the imputation,” Utah Code Ann. § 78B–12–203(7)(a). See Fish, 2010 UT App 292, ¶¶ 20, 22, 242 P.3d 787 (remanding for additional findings on whether income should be imputed and how much); Willey, 866 P.2d at 554 (same); Hall, 858 P.2d at 1024–27 (same). But see ...