Under what circumstances will a Florida court make an alimony order effective retroactively?

The trial court awarded the Wife retroactive alimony in the amount of $4000 per month and retroactive child support in the amount of $664 per month for the period from the filing of the petition for dissolution of marriage (June 2007) to the entry of the final judgment (December 2008)— approximately eighteen months. The trial court gave the Husband twenty-four months to pay the retroactive alimony award of approximately $72,000. The trial court ordered that an additional ten percent per month be added to the child support obligation to pay the retroactive child support amount.

"A trial court may award retroactive alimony when appropriate," Cleary v. Cleary, 872 So.2d 299, 303 (Fla. 2d DCA 2004), but an award of retroactive alimony must be based on the receiving spouse's need for alimony and the paying spouse's ability to pay, Alpert v. Alpert, 886 So.2d 999, 1002 (Fla. 2d DCA 2004). Here, as with the permanent periodic alimony award, the trial court made no findings concerning the parties' incomes during the relevant eighteen-month period as required by section 61.08, nor did it make any specific findings supporting its conclusion that the Husband had the ability to pay. See Alpert, 886 So.2d at 1002. In addition, no evidence was presented contradicting the Husband's reported 2007 gross income of about $24,000.

The Husband also argues that he should receive a credit against the retroactive alimony for the mortgage payments he made on the marital home during

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the period of the parties' separation. We disagree. Prior to the final judgment of dissolution, the marital residence was held as a tenancy by the entireties. "In such an estate, both parties are obligated for the whole of any expenses or debt on the property (including mortgage payments and insurance)." Taber v. Taber, 626 So.2d 1089, 1090 (Fla. 1st DCA 1993). Thus,

[t]he party seeking to show a special interest as a result of contributions has the burden of proof to demonstrate that such a payment was from nonmarital funds or as a result of special efforts, and did not constitute payment of marital expenses. Any expenditures made during the marriage are presumed to be in furtherance of the marriage, and the burden of proof would be on the party seeking to show that some special credit should be given for these payments made during the marriage.

Id. (citations omitted).

We also note that the Husband conceded at trial that he would have continued to make the mortgage payments, just as he had before the separation, regardless of whether the Wife continued to reside in the marital home. See Kranz v. Kranz, 737 So.2d 1198, 1202-03 (Fla. 5th DCA 1999) (holding that the husband was not entitled to a credit for mortgage payments made during the parties' separation). See also Knecht v. Knecht, 629 So.2d 883, 888 (Fla. 3d DCA 1993) (reversing credit to husband for mortgage payments made during the period between separation and dissolution because "the marital assets were acquired largely on the strength of the husband's income, which provided the cash flow to meet the mortgage payments and expenses"). Accordingly, we cannot conclude that the trial court abused its substantial discretion in denying the Husband's request for such credit. See Stock v. Stock, 693 So.2d 1080, 1086 (Fla. 2d DCA 1997) ("Reimbursement or credit for a party's payment of marital property-related expenses during separation is a matter of judicial discretion in light of all relevant circumstances.").

On the other hand, we observe that during the period from the parties' separation through the trial, the Wife withdrew approximately $35,000 from the proceeds of the Husband's personal injury settlement for the support of the household. If, on remand, it is determined that these funds are nonmarital assets,⁴ the Husband should receive a setoff against these withdrawals for the relevant period. If these funds are determined to be marital assets, the trial court must determine whether the Husband is due a partial setoff based on his share of those assets. See Welch v. Douglas-Welch, 800 So.2d 630, 630 (Fla. 2d DCA 2001).

We reverse the awards of retroactive alimony and retroactive child support. On remand, the trial court shall revisit these issues. If the trial court again determines that retroactive alimony, retroactive child support, or both of them are appropriate, such determination shall be supported by specific findings concerning the sources and amounts of the parties' respective incomes during the period from the date of the separation to the entry of the final judgment of dissolution of marriage.

An award of retroactive alimony, like any other award of alimony, must be based on the receiving spouse's need for alimony and the paying spouse's ability to pay. See Alpert v. Alpert, 886 So.2d 999, 1002 (Fla. 2d DCA 2004); Schellhammer v. Schellhammer, 687 So.2d 987, 989 (Fla. 5th DCA 1997); Hodge v. Hodge, 607 So.2d 510, 511 (Fla. 5th DCA 1992). When one spouse has sufficient income to pay alimony during the pendency of dissolution proceedings but instead decides to provide only nominal support, thus requiring the other spouse to invade marital assets for support, an award of retroactive alimony may be proper. See Alpert, 886 So.2d at 1002.

Here, the evidence showed that the Wife was fully able to support herself with the $5300 in rental income from the Doty Circle commercial property and the 75 Munger Road residence from the date of filing in November 2007 until June 2008. At that point, however, the Husband unilaterally

[36 So.3d 162]

decided to keep the $4000 per month rental income from the Doty Circle commercial property, thus leaving the Wife with only $1300 per month in income. The Husband provided no support to the Wife from his now $14,000 per month income. Instead, as a practical matter, he required the Wife to support herself by supplementing her $1300 per month income with funds withdrawn from the parties' joint bank accounts. On these facts, the trial court's decision to award the Wife retroactive alimony is fully supported by the evidence presented at the hearing.

However, as with the amount of permanent alimony, the amount of retroactive alimony awarded is not supported by the evidence because it does not account for the Wife's use of the Husband's share of certain marital assets to support herself. The record shows that at the time of filing in November 2007, the Wife “controlled” a bank account at Regions Bank that contained $60,000. There is apparently no dispute that this was a joint account containing marital funds. After the Husband redirected the $4000 per month in rental income from the Doty Circle commercial property to himself, the Wife transferred at least $22,000 of the funds in the Regions Bank account into an account in her sole name, and she used those funds to support herself. She apparently also used another $10,000 that the parties had withdrawn from their joint Smith Barney account. The final judgment on its face does not account for the Wife's use of the Husband's one-half share of these marital funds.

In Welch v. Douglas-Welch, 800 So.2d 630, 630 (Fla. 2d DCA 2001), this court addressed a similar situation, stating:

Benjamin Welch appeals the final judgment of dissolution of his marriage to Anna Welch. He raises several issues in this appeal, but we find merit only in his argument regarding the trial court's disposition of the parties' joint savings account.

In the order granting Anna's motion for temporary alimony, the trial court found that at the time of separation, Anna removed the $32,000 in the parties' joint savings account and placed that amount in a separate account. The court further found that, as of the date of the hearing on Anna's motion for temporary alimony, Anna had used all but $9000 of the parties' joint savings. The trial court's only reference to the parties' joint savings account in the final judgment of dissolution is the incorporation of these findings from the order granting temporary alimony into that judgment and a finding that all bank accounts had already been divided between the parties.

Benjamin contends that he has not been given credit for Anna's use of his share of the parties' joint savings account. He requests that his obligation to pay Anna retroactive temporary alimony be offset by Anna's use of his share of the parties' savings.

The final judgment of dissolution is not clear with regard to the disposition of the parties' joint savings account. See § 61.075(3), Fla. Stat. (2000). Accordingly, we remand the judgment for findings regarding the disposition of this marital asset, as well as consideration of whether the record supports any type of credit to Benjamin for Anna's use of his share of the parties' joint savings account.

In this case, as in Welch, the final judgment does not address whether the Husband should be entitled to credit against the award of retroactive alimony for the Wife's use of the Husband's “share” of the Regions Bank account or the Husband's “share” of the Smith Barney funds during

[36 So.3d 163]

the dissolution proceedings. Accordingly, as in Welch, we reverse the amount of retroactive alimony awarded and remand for the trial court to determine whether any such credit is warranted in this case.

The parties agree that the trial court erred in awarding retroactive child support for seventeen months rather than fifteen months because the parties were still living together during the extra two months.

[...]

Awards of retroactive alimony are reviewed for an abuse of discretion. Wright, 411 So.2d at 1336. Awards of retroactive alimony must be based on need and ability to pay. Vitro v. Vitro, 122 So.3d 382, 385 (Fla. 4th DCA 2012). The trial court must make specific findings regarding

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those factors. Valentine v. Van Sickle, 42 So.3d 267, 274 (Fla. 2d DCA 2010).

As with the prospective alimony, the first and most important issue is the trial court's consideration of the incorrect income for the parties. On remand, the trial court should determine retroactive alimony based on a gross monthly income of $4381 for the former husband and a gross monthly income of $3675 for the former wife.

Similarly, as with the retroactive child support, the trial court erred in awarding retroactive alimony for seventeen months rather than for only fifteen months.

Particular to the issue of retroactive alimony, the trial court did not make specific findings of the former wife's need and the former husband's ability to pay “during the relevant ... period.” Valentine, 42 So.3d at 274. Instead, the court found that “Wife has a need for alimony,” “Wife has a current need for alimony,” and that “Husband does not have the current [ability] to pay all of the alimony Wife needs. ” (emphases added). The court made findings regarding only the former wife's current need and the former husband's current ability to pay, when it was required to make findings about need and ability during the retroactive time period.

We therefore reverse the award of retroactive alimony and remand for the trial court to consider the evidence and, if it determines that it is appropriate, to make the proper findings of past need and ability to pay. If it makes those findings, it should recalculate the amount of alimony owed using the proper incomes for the parties and the proper number of months over which the retroactive alimony is owed.

The former wife also challenges the trial court's failure to make the alimony award retroactive to the date of filing of the petition for dissolution.

Generally, when a trial court awards alimony, it abuses its discretion if it fails to make the award retroactive to the date of filing the petition for dissolution. See Featherston v. Featherston, 86 So.3d 549, 551 (Fla. 2d DCA 2012). There is an exception where the trial court enters a temporary alimony award during the pendency of the case. See Kraus v. Kraus, 749 So.2d 513, 514 (Fla. 2d DCA 1999). In that situation, a retroactive award is limited to the date that the request for an increased award is filed. See id. However, we have previously recognized that a temporary alimony award can be readdressed at a final hearing if the temporary award was made “without prejudice.” Dent v. Dent, 851 So.2d 819, 820 (Fla. 2d DCA 2003).

In this case, the parties stipulated that the former husband would pay temporary alimony, and the court awarded temporary alimony “without prejudice.” Given our reversal of the permanent, periodic alimony award, the trial court should, on remand, reconsider the issue of retroactivity of any newly imposed permanent, periodic alimony award. This should be done after comparing such award to the stipulated temporary alimony.

We review the trial court's decision to apply the modification to child support and alimony retroactively for abuse of discretion. “A trial court has the discretion to modify alimony effective as of the date of the petition for modification or subsequent thereto.” Ray v. Ray, 707 So.2d 358, 360 (Fla. 2d DCA 1998); see also Thyrre v. Thyrre, 963 So.2d 859, 861–62 (Fla. 2d DCA 2007) (quoting Ray in support of same). “Retroactivity is the rule rather than the exception which guides the trial court's application of discretion when modification of alimony or child support is granted.” DeSantis v. Smith, 634 So.2d 796, 797 (Fla. 4th DCA 1994); see also Thyrre, 963 So.2d at 862 (quoting DeSantis in support of same). “Accordingly, there is a presumption of retroactivity which applies unless there is a basis for determining that the award should not be retroactive.” Thyrre, 963 So.2d at 862.

“However, the circumstances of the case may dictate otherwise.... [T]he proof may demonstrate a substantially different condition at the hearing on the petition than that which existed on the date of the filing thereof. These are the things that involve a trial judge's discretion.” Bloom v. Bloom, 503 So.2d 932, 934 (Fla. 4th DCA 1987); see also Thyrre, 963 So.2d at 862 (quoting Bloom in support of same).

We conclude that the trial court abused its discretion in modifying the Former Husband's child support and alimony obligations retroactive to the date of the petition. When the Husband filed his supplemental petition to modify child support and alimony, he was unemployed and the amount of any settlement with his former employer for his severance from the company was an unknown quantity. But the Former Husband entered into a settlement with his former employer just a few days after filing the petition, which included $250,000 in future lost wages. The trial court found that “[t]he Former Husband exhausted all or most of his severance pay in meeting his obligations, including his spousal and child support obligations to the Former Wife.” In fact, he was able to pay his child support obligation under the MSA through September 2012 and his alimony obligation under the MSA through November 2012. Accordingly, during the sixteen-month period between the filing of the supplemental petition and the final hearing, the Former Husband was able to meet almost all of his support obligations

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under the MSA by using the settlement funds from his former employer, which included a wage component.

The Former Husband properly used the $250,000 in future lost wages to pay his expenses and support obligations under the MSA. Wages and salary are specifically included in the definition of “income” under section 61.046(8), Florida Statutes (2011), and should be considered in determining child support and alimony obligations. Fitzgerald v. Fitzgerald, 912 So.2d 363, 366–67 (Fla. 2d DCA 2005). Moreover, in the context of a dissolution proceeding, the Florida Supreme Court has held that damages awarded “for future loss of wages [on a worker's compensation claim] may be taken into account in determining alimony and support awards.” Weisfeld v. Weisfeld, 545 So.2d 1341, 1346 (Fla.1989); see also White v. White, 820 So.2d 432, 434 (Fla. 4th DCA 2002) (citing Weisfeld in support of same).

The Former Husband's severance settlement was sufficient to cover his expenses and support obligations under the MSA during the period that the supplemental petition was pending, and the wage component of that settlement greatly exceeded his income at the time of the final hearing. Thus the trial court's retroactive application of the modification of child support and alimony based upon his income at the time of the final hearing resulted in the Former Husband receiving a credit for overpayment of child support and alimony during a period in which his income was sufficient to support those payments. The retroactive application of the modification also leads to the imposition of a great hardship on the Former Wife and the parties' children, who are not presently receiving any support because of the trial court's entry of a judgment in the amount of $58,468.70 for the overpayment credit against the Former Wife. Thus retroactive application of the modification of the child support and alimony awards amounted to an abuse of discretion under the circumstances of this case.