Alimony and Imputation of Defendant’s Income

Davidson v. Davidson, 2022-NCCOA-267 (unpublished)

 

In North Carolina, alimony orders are modifiable upon showing the court that there has been a substantial change in circumstances for either party. In doing so, the trial court ought to revisit many of the factors that justified the original alimony order. The main requirement is that the modification order must relate to the financial needs of the dependent spouse and/or the ability to pay of the supporting spouse.

 

Facts: Plaintiff was found the be the dependent spouse, and Defendant was ordered to pay $4,500 a month in alimony, increasing to $5,300 when a minor child reached the age of majority. This order was entered in 2015. In 2019, Defendant filed a motion to modify based on his loss of employment and decreased income. The trial court modified the alimony and Defendant’s new obligation was $1,966.90. In doing so, the trial court imputed at least $40,000 of yearly income for the Plaintiff. Plaintiff appeals.

 

Issue: Did the trial court err in imputing income to Plaintiff?

 

Holding: No

 

Reason: First, Plaintiff argued that it was error to impute income to her because the prior order did not do so. However, case law expressly allows the reconsideration of imputing income either in the original order establishing an obligation or in a motion to modify it. Moreover, it is appropriate to consider the dependent spouse’s financial needs, or change therein, because one of the statutory factors the trial court is to consider includes the relative earnings and earning capacities of the spouses. Since the trial court heard evidence and made findings on Plaintiff’s financial capacities at the modification hearings, it was proper to consider the facts that resulted in imputing income to her.

 

Plaintiff also argued that this was Defendant’s motion, and Defendant did not allege that Plaintiff should have income imputed on her. However, since the trial court heard evidence on this issue, without objection from Plaintiff’s counsel, and made arguments in contrary to imputation, Plaintiff waives the ability to challenge on this ground. This is expressly explained in the Rules of Civil Procedure Rule 15(b).

 

As it turned out, Plaintiff was basically devoting “full-time” working hours to volunteer positions, including being vice-president and member of the board at a “financially successful” non-profit organization. In addition, she also had various personal and public ventures for which she could have been paid. These facts and the legal precedent allowed the trial court to impute income.