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Hobbs v. Hobbs9/5/2000
FOR PUBLICATION
The parties entered into a marital dissolution agreement that provided for a decreased payment of child support during the father's period of unemployment followed by an increased amount of child support to be paid after the resolution of the father's workers' compensation case. The father settled his claim and was awarded $125,000 in a lump sum. Applying Tenn. Code Ann. § 50-6-223, the trial court ruled that "gross income" as defined by the Tennessee Child Support Guidelines did not include the father's lump sum workers' compensation benefit. The Court of Appeals reversed, holding that it would be illogical to exclude lump sum workers' compensation payments from computation of child support when periodic payments may be included. We granted permission to appeal. We hold that lump sum awards of workers' compensation must be used to compute gross income under the Tennessee Child Support Guidelines.
Tenn. R. App. P. Rule 11 Appeal by Permission; Judgment of the Court of Appeals Affirmed; Case Remanded to Trial Court
Janice M. Holder, J., delivered the opinion of the court, in which E. Riley Anderson, C.J., and Frank F. Drowota, III, Adolpho A. Birch and William M. Barker, JJ., joined.
OPINION
On November 22, 1996, the trial court entered a final decree of divorce incorporating the parties' Marital Dissolution Agreement. The agreement provided for the support of the parties' two minor children as follows:
That, the parties agree that Husband is currently unemployed due to a work-related injury suffered by him. In this regard, the parties have agreed that husband shall be responsible for the payment of child support in the amount of $400.00 per month until Husband's workers' compensation action is concluded, or twelve (12) months has expired, whichever comes first. However, when Husband's workers' compensation claim shall be concluded, whether by settlement, judgment or otherwise, Husband shall pay to Wife a lump sum equal to the difference in the amount of interim child support of $400.00 per month, and $960.00 per month, which is his actual child support obligation. In addition, Husband shall resume regularly monthly payments of child support in the above sum after conclusion of his workers' compensation case. Husband shall pay said child support obligation directly to Wife.
After the entry of the final decree, Mr. Hobbs' workers' compensation claim was settled for a lump sum of $125,000.
On October 29, 1997, Ms. Hobbs filed a Petition for Contempt, alleging a $2,500 arrearage in child support. On February 9, 1998, Mr. Hobbs petitioned the court for a reduction of child support. He contended that his child support obligation should be reduced from $960.00 to $565.00 per month based upon his monthly income from three sources: retirement, Veteran's Administration benefits, and Social Security Administration benefits.
A hearing was held on May 1, 1998, at which the court addressed Ms. Hobbs' Petition for Contempt. The trial court found an arrearage in child support of $11,760. That amount was ordered to be paid from Mr. Hobbs' lump sum workers' compensation award pursuant to Tenn. Code Ann. § 50-6-223. The trial court, however, declined to consider the $125,000 lump sum payment as part of Mr. Hobbs' gross income under the Child Support Guidelines. Accordingly, the trial court granted a reduction in child support from $960.00 to $565.00. Ms. Hobbs appealed the exclusion of the lump sum payment from Mr. Hobbs' gross income.
The Court of Appeals reversed, holding that Mr. Hobbs' lump sum workers' compensation settlement was income for the purposes of determining his chi
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