Carpenter v. Carpenter

• Decision Date: 19 January 2016
• Docket Number: No. COA14–1066.,COA14–1066.
• Parties: Louise Annette CARPENTER, Plaintiff, v. Fred J. CARPENTER, Jr., Defendant.
• Court: North Carolina Court of Appeals

245 N.C.App. 1

781 S.E.2d 828

Louise Annette CARPENTER, Plaintiff,

v.Fred J. CARPENTER, Jr., Defendant.

No. COA14–1066.

Court of Appeals of North Carolina.

Jan. 19, 2016.

Wyrick Robbins Yates & Ponton, LLP, Raleigh, by Tobias S. Hampson and K. Edward Greene, for plaintiff-appellant.

Jonathan McGirt, for defendant-appellee.

CALABRIA, Judge.

Louise Annette Carpenter ("plaintiff") appeals from an order denying her claims for alimony and attorneys' fees, and granting an unequal distribution of property in favor of Fred J. Carpenter, Jr. ("defendant"). We vacate in part and remand the portions of the order denying alimony and attorneys' fees. We affirm in part, vacate in part, and remand for additional proceedings the portion of the order regarding equitable distribution.

I. Background

Plaintiff, a nurse anesthetist, and defendant, an anesthesiologist (collectively, "the parties"), were married on 11 November 1995, and after the parties separated on 30 November 2011, their minor child resided with defendant. During the marriage, plaintiff was employed in various positions, including working for defendant's practice group until 28 February 2010. When plaintiff terminated her employment, she never worked again during the parties' marriage. After the parties separated, plaintiff resumed working as a nurse anesthetist on a contract basis and was paid $250 for her first four hours of work on any given shift, and $65 per hour for additional hours. Plaintiff estimated her earning potential at $40,000 to $50,000 per year. Defendant reported that his income prior to August 2013 included an annual salary from his practice group of $120,000, an additional annual salary from Duke University Medical Center of $15,000, and $94,900 in annual disability payments. In total, defendant earned $229,900 annually.

On 3 June 2011, plaintiff filed a complaint against defendant including claims for divorce from bed and board, post-separation support, alimony, and child custody. Defendant filed his answer on 27 June 2011, which included a counterclaim for custody. Subsequently, their pleadings were amended to add a claim for equitable distribution.

After a trial in Orange County District Court, the Honorable Beverly A. Scarlett found plaintiff's income was in excess of $130,000 per year, concluded that plaintiff was not a dependent spouse, and denied her alimony claim and request for attorneys' fees. For equitable distribution, the trial court found that "an unequal division of property is equitable." Specifically, for the mixed investment fund valued at approximately $1.4 million at the time of the parties' separation, the court determined that after defendant received his separate contributions, 70 percent of the remainder was to be distributed to defendant and 30 percent to plaintiff. On 12 March 2014, the trial court ordered an unequal distribution of the parties' property in favor of defendant. Plaintiff appeals.

II. Alimony

Plaintiff first argues the trial court's findings were insufficient to support its conclusions that she was not a dependent spouse and thus was not entitled to alimony. We agree.

In all non-jury trials, the trial court must specifically find "those material and ultimate facts from which it can be determined whether the findings are supported by the evidence and whether they support the conclusions of law reached." Crocker v. Crocker, 190 N.C.App. 165, 168, 660 S.E.2d 212, 214 (2008) (quoting Quick v. Quick, 305 N.C. 446, 451, 290 S.E.2d 653, 657 (1982) ; citing N.C. Gen.Stat. § 1A–1, Rule 52 (2007) ). A trial court's determination of whether a party is entitled to alimony is reviewable de novo on appeal. Barrett v. Barrett, 140 N.C.App. 369, 371, 536 S.E.2d 642, 644 (2000) (citing Rickert v. Rickert, 282 N.C. 373, 379, 193 S.E.2d 79, 82 (1972) ).

Whether a party is entitled to alimony is determined by statute. N.C. Gen.Stat. § 50–16.3A(a) (2013). A party is entitled to alimony, inter alia, if (1) that party is a "dependent spouse;" (2) the other party is a "supporting spouse;" and (3) an award of alimony would be equitable under all relevant factors. Id. A "dependent spouse" must be either actually substantially dependent upon the other spouse or substantially in need of maintenance and support from the other spouse. Id. at § 5016.1A(2). A party is "actually substantially dependent" upon her spouse if she is currently unable to meet her own maintenance and support. Barrett, 140 N.C.App. at 370, 536 S.E.2d at 644 (citing Williams v. Williams, 299 N.C. 174, 180, 261 S.E.2d 849, 854 (1980) ). A party is "substantially in need of maintenance and support" if she will be unable to meet her needs in the future, even if she is currently meeting those needs. Barrett, 140 N.C.App. at 371, 536 S.E.2d at 644. If the trial court determines that a party's reasonable monthly expenses exceed her monthly income, and that she has no other means with which to meet those expenses, it may properly conclude the party is dependent. Beaman v. Beaman, 77 N.C.App. 717, 723, 336 S.E.2d 129, 132 (1985).

To determine whether a party is substantially in need of maintenance and support, and therefore a dependent spouse, "the court must determine whether [that] spouse would be unable to maintain his or her accustomed standard of living, established prior to separation, without financial contribution from the other." Vadala v. Vadala, 145 N.C.App. 478, 481, 550 S.E.2d 536, 538 (2001). Thus, "[i]t necessarily follows that the trial court must look at the parties' income and expenses in light of their accustomed standard of living" when determining whether a party is properly classified as a dependent spouse. Helms v. Helms, 191 N.C.App. 19, 24, 661 S.E.2d 906, 910 (2008) (citing Williams, 299 N.C. at 182, 261 S.E.2d at 856 ). The reasonableness of a spouse's expenses, including maintenance and support, must be viewed according to the parties' accustomed standard of living during the marriage. Williams, 299 N.C. at 183, 261 S.E.2d at 856.

In the instant case, plaintiff testified that she worked three days per week, averaging nine hours per day, and that she earned between $40,000 and $50,000 per year. This assertion was supported by her financial affidavit for her 2012 income of $3,359.68 per month, her 2012 W–2, and several bank statements. Further, plaintiff carefully described her typical weekly work schedule and wages, specifically stating that she earns $250 for the first four hours and $65 per hour afterwards on any given day when she works on an "on-call" basis. Plaintiff explained that she always works whenever her employer calls her, but that the number of hours she works on any particular shift varies greatly, ranging from 10 hours over a two-day period to 16 hours on a single day. Nevertheless, the trial court calculated plaintiff's average net income to be $130,260 per year, even though there was no evidence in the record to suggest that plaintiff was depressing her income by working two or three days per week on an "on call" basis. If the trial court imputed income to plaintiff on the basis of earning capacity, its calculation of plaintiff's income would constitute error. "[B]as[ing] an alimony obligation on earning capacity rather than actual income [requires] the trial court [to] first find that the party has depressed her income in bad faith." Works v. Works, 217 N.C.App. 345, 347, 719 S.E.2d 218, 219 (2011) (internal citation omitted). Alternatively, if the trial court included the $7,500 of monthly post-separation support ("PSS") plaintiff received from defendant in calculating her income, this would also constitute error, as PSS—which eventually terminates upon the occurrence of specified events—is not permanent income. See N.C. Gen.Stat. § 50–16.1A(4). Therefore, the trial court erred in its calculation of plaintiff's income.

For plaintiff's monthly expenses, the trial court found that plaintiff reported total monthly expenses of $11,468.19, while defendant reported total monthly expenses for himself and the parties' minor child of $8,680.42. Although the trial court found that the parties did not have a household budget, the court characterized plaintiff's expenses as "excessive," and specified that plaintiff "was a spendthrift during the marriage[,]" spent her salary "lavishly" on yearly trips and vacations, and did not use her salary to enhance the marital economy. Because the trial court failed to determine which, if any, of plaintiff's expenditures were reasonable in light of her accustomed standard of living, during the parties' marriage, and failed to engage in the necessary comparison of those reasonable expenses to a correct calculation of plaintiff's income, the court erred in concluding that plaintiff was not a dependent spouse. See, e.g., Williams, 299 N.C. at 182–83, 261 S.E.2d at 856. As a result, we cannot determine whether plaintiff was a dependent spouse entitled to alimony.

Plaintiff also argues that the trial court's findings are sufficient to support a conclusion that defendant is a supporting spouse. But just because one party is a dependent spouse does not automatically mean that the other party is a supporting spouse. Barrett, 140 N.C.App. at 373, 536 S.E.2d at 645. Rather, to be deemed a "supporting spouse," as defined in N.C. Gen.Stat. § 50–16.3A, the party must be either substantially depended upon or substantially relied upon for maintenance and support by the dependent spouse. N.C. Gen.Stat. § 50–16.1A(5).

The trial court may properly conclude a party is a supporting spouse if it determines that he enjoys a surplus of income over expenses. Barrett, 140 N.C.App. at 373, 536 S.E.2d at 645. Presuming, without deciding, the record supports plaintiff's contention, the trial court must determine whether defendant was a supporting spouse, if it concludes on remand that plaintiff is a dependent spouse. Accordingly, we vacate that portion of the trial court's order denying plaintiff's alimony claim and remand for...