Mckee v. Mckee

• Decision Date: 05 August 2008
• Docket Number: Record No. 0739-07-1.
• Citation: 52 Va. App. 482,664 S.E.2d 505
• Court: Virginia Court of Appeals
• Parties: Brian McKEE v. Barbara McKEE.

664 S.E.2d 505

52 Va. App. 482

Brian McKEE v. Barbara McKEE.

Record No. 0739-07-1.

Court of Appeals of Virginia, Richmond.

August 5, 2008.

Debra C. Albiston (Dannielle C. Hall-McIvor; Kaufman & Canoles, on briefs), Virginia Beach, for appellant.

Kenneth B. Murov, Newport News, for appellee.

Present: FELTON, C.J., and ELDER, HUMPHREYS, CLEMENTS, KELSEY, McCLANAHAN, HALEY, PETTY, BEALES and MILLETTE, JJ.

ROBERT J. HUMPHREYS, Judge.

UPON A REHEARING EN BANC

This matter comes before the Court on a rehearing en banc following a divided panel opinion of this Court. Brian McKee ("husband") appeals from a final decree of divorce, terminating his marriage to Barbara McKee ("wife"). He presents three issues for en banc review, all stemming from the circuit court's award of spousal support to wife. He claims that the circuit court abused its discretion by (1) refusing to impute income to wife, (2) basing its award of support on speculative expenses claimed by wife and (3) providing for wife's mortgage payment in the spousal support award.¹ In regard to husband's second issue presented, we affirm the circuit court's decision without further elaboration as the Court is evenly divided.² In regard to husband's first and third issues presented, we affirm the circuit court for the following reasons.

I. Background

On appeal, we view the evidence in the light most favorable to wife, the party prevailing below. Congdon v. Congdon, 40 Va. App. 255, 258, 578 S.E.2d 833, 835 (2003). So viewed, the evidence in this case establishes the following.

Husband and wife married on August 22, 1987. Their marriage produced three children. In 1991, husband and wife agreed that wife would stop working in order to stay home with their children. Husband is an ophthalmologist and, as such, was able to support the family solely on his salary. Throughout the marriage, wife stayed at home raising the couple's three children, while husband focused on his professional pursuits. On April 3, 2004, husband abandoned the marriage. On June 29, 2004, wife filed for divorce.

The parties subsequently entered into a separation agreement ("the Separation Agreement") that settled all matters pertaining to the distribution of the couple's property. As part of the Separation Agreement, husband agreed to convey his interest in the marital home to wife. Wife agreed to become "solely responsible" and to "indemnify and hold Husband harmless from any liability" for the home's $200,000 mortgage. As part of the agreement, husband and wife waived their right to equitable distribution by a court. The couple also made it explicit in the Separation Agreement that the agreement was to have no effect on several unresolved issues, including spousal support. In a paragraph entitled "EXTENT OF AGREEMENT" the Separation Agreement declared:

Husband and Wife further acknowledge that this Agreement does not contain any provisions as it relates to spousal support. ... Husband and Wife agree that the terms of this Agreement shall have no effect on his or her claims or positions related to these matters and that each does hereby reserve all claims or position he or she has related to such matters which shall be determined by subsequent agreement between the parties or by determination by a court of competent jurisdiction. Husband and Wife further agree that neither waives any claim or position he or she has related to such matters despite any general or specific releases or waivers contained elsewhere in this Agreement.

On November 28, 2005, the circuit court held a hearing to address the issues left unresolved by the Separation Agreement. Wife's attorney explained that wife intended to borrow $250,000 against the home in order to pay off the remaining $200,000 owed on the original mortgage and make necessary repairs to the home. In the expense sheet wife provided to the court, she listed $1,500 in monthly housing expenses attributable to the new $250,000 mortgage. Husband argued that wife was not entitled to spousal support covering her mortgage payment because she had agreed to assume the mortgage in the Settlement Agreement. Husband claimed that the court was bound by Gamble v. Gamble, 14 Va.App. 558, 421 S.E.2d 635 (1992), to exclude the mortgage payment from its determination of spousal support.

Also at the hearing, husband argued that the circuit court should impute income to wife because she was qualified to work and was not doing so. In support of husband's position, Frances Charles DeMark ("DeMark"), a "vocational expert," testified regarding wife's earning capacity. He estimated that the annual earnings of respiratory therapists range from $40,000 to $52,000. DeMark testified that he had easily located advertisements of current openings for respiratory therapists at various hospitals in the area. He also stated that he "would imagine that there's [sic] also some openings in doctor's offices." DeMark concluded that wife could earn at least $30,000 to $40,000 per year working as a full-time respiratory therapist. However, he conceded that, in order to care for her three children before and after school, as she did while married, wife would only be able to work part-time. DeMark did not testify as to whether part-time work was available to a respiratory therapist, nor did he provide any specific information about the availability of jobs or wife's salary potential outside the field of respiratory therapy.

In regard to her earning capacity, wife testified that, although she is a registered therapist, she is not licensed to practice respiratory care in Virginia. She explained that when she previously worked as a respiratory therapist, Virginia did not require licensure. She testified further: "Today I believe continuing education credits and licensure is required [to practice respiratory care]." When asked about the licensure issue, DeMark testified that he did not know whether wife would have to become licensed or complete continuing education courses in order to work as a respiratory therapist. When asked, "Did you check to see what the education requirements were for somebody who had not worked for 14 years?," DeMark responded simply "No."

Wife also testified that she had applied to work as a substitute teacher in the public school system and was "on the list" to substitute at her children's private school.

After the presentation of evidence by both parties, the circuit court granted spousal support to wife. The court denied husband's request that the court impute income to wife stating:

I mean, it's somewhat incredible to think that you can be out of the job market for the length of time that [wife has] and get a job earning 45 to 55, 60 thousand dollars a year. I mean, that would be the most remarkable thing I could imagine right now. I mean it's just not — I mean, I can see you working somewhere, but the market is simply not that. I don't think the expert has enough documentation to say that those things are readily and easily available and suitable, and I also don't think it's required.

* * * * * *

I'm not saying that [wife] shouldn't try to work ... but I'm not sure that the law says the moment your husband leaves the wife has to go to work, under these circumstances.

The court also held that Gamble did not prohibit the consideration of wife's mortgage payment in determining spousal support and accounted for the mortgage payment in the spousal support award.

Husband appealed the circuit court's decision. A divided three-judge panel of this Court held that the circuit court abused its discretion by applying an improper legal standard in determining that income should not be imputed to wife. Relying on Gamble, the panel unanimously held that the circuit court erred by considering wife's mortgage payment in determining spousal support.

By order dated February 29, 2008, this Court granted wife's petition for rehearing en banc and stayed the mandate of the panel decision.

II. Analysis

A. Imputation of Income

"A court may under appropriate circumstances impute income to a party seeking spousal support." Srinivasan v. Srinivasan, 10 Va.App. 728, 734, 396 S.E.2d 675, 679 (1990). "The decision to impute income is within the sound discretion of the trial court and its refusal to impute income will not be reversed unless plainly wrong or unsupported by the evidence." Blackburn v. Michael, 30 Va.App. 95, 102, 515 S.E.2d 780, 784 (1999). Husband claims that wife was voluntarily unemployed and that the circuit court abused its discretion by refusing to impute income to wife. He claims that the circuit court abused its discretion as a matter of law by applying an erroneous legal standard when it refused to impute income. In the alternative, he argues that, based on the evidence, the circuit court was bound to impute income to wife. We disagree on both counts.

Generally, "one who seeks spousal support is obligated to earn as much as he or she reasonably can to reduce the amount of the support need." Srinivasan, 10 Va.App. at 734, 396 S.E.2d at 679. However, so long as the spouse seeking support has not "unreasonably refused to accept employment," the spouse is "entitled to a reasonable time to secure employment." Id. Furthermore, in determining whether to impute income, the circuit court "must look to current circumstances and what the circumstances will be `within the immediate or reasonably foreseeable future,' not to what may happen in the future." Id. at 735, 396 S.E.2d at 679 (quoting Young v. Young, 3 Va.App. 80, 81-82, 348 S.E.2d 46, 47 (1986)).

In support of his argument that the circuit court applied an erroneous standard, husband points to the following statement made by the circuit court in its ruling. The court stated:

This is not a case of imputed income so much as it is some sort of challenge that you are voluntarily underemployed or unemployed, and that law imposes a duty upon you to be employed.

I don't think that's what the law is.

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