NJ Family Legal Blog : New Jersey Divorce and Family Lawyer & Attorney : Fox Rothschild Law Firm : Alimony, Child Support, Child Custody, Prenuptial Agreements, Essex, Morris, Mercer, Atlantic

Following up on my most recent blog post discussing pressure tactics used by one spouse against the other to force an inequitable settlement, I wanted to focus on the example where one spouse tries to "get around" the lawyers to privately discuss settlement with the other spouse.  In my prior entry, I noted that a financially superior spouse will often take this tack to impose his desired terms of settlement upon the other spouse.  The day after the Court enters a Judgment of Divorce ending the marriage, the financially inferior spouse wakes up and regrets the deal she just made.

While I am not generally against the notion of spouses talking to each other in an effort to resolve their matter, the involvement of lawyers is key for conveying notions of what is fair or unfair.  Here are a few questions that come to mind:

1.  How do you know whether the alimony and child support are fair?

2.  How do you know whether the equitable distribution is fair?

3.  How do you know what is an appropriate custody and parenting time arrangement?

4.  How do you know what you are entitled to under the law as a spouse, parent and litigant?

• Print
• Comments
• Trackbacks
• Share Link

All too often one spouse will pressure the other to settle an ongoing case, using finances, custody, or some other issue to force an inequitable end to a matter.  This comes up all the time, yet the pressured spouse frequently doesn't realize that it is happening, whether it is because she trusts her soon to be ex-spouse, is scared (or simply does not want) to litigate to obtain what is fair and reasonable, or for a variety of other reasons.

So what type of comments/efforts will one spouse make to pressure the other spouse into a settlement?  For the sake of brevity, I provide a list of ten fan favorites below, although the list could likely go on and on without end.  

1.  You are going to have to start cutting back on your (not his) lifestyle expenses or else we are not going to be able to afford to litigate this matter.  While in some cases this may be a true statement, I find this one particularly obvious and offensive in cases where there is more than enough income and assets to litigate and maintain the marital lifestyle for both parties.  

2.  You are going to cause us to go to trial (alternatively, "my lawyer told me that I am right, so I would rather go to trial than give you what you want").

3.  Do you really want to drag the kids into the middle of a (legitimate) custody dispute?

4.  I will give you what you want on custody and parenting time so long as you give me what I want financially.  This example is particularly common, but the issues should not be intertwined.

5.  Your lawyer is preventing us from settling (alternatively, "I want to try to work this out with you privately and impose my terms without your lawyer getting in the way").

6.  My income this year is not going to be what it once was, so we really cannot afford to litigate this matter.  (see also prior blog posts on Rapidly Acquired Income Deficiency Syndrome "RAIDS")

7.  I would rather pay my lawyer than pay you.  This classic line really has no bearing on the outcome of a support or equitable distribution issue, and, in fact, provides a compelling argument by the supported spouse for counsel fees due to the payor spouse's unreasonable conduct.

8.  The act (or repeated act) of violating an interim support ("pendente lite") Order requiring payment for various expenses.  This form of non-compliance forces the supported spouse to determine whether she wants to continually file costly motion after costly motion to address the payor spouse's non-compliance, or simply give in and surrender in the matter.

9.  Threatening the supported spouse that if she does not agree to go to mediation, she will "regret it".

10.  Any type of what is commonly known as "Divorce planning", ranging from ensuring a reduction in income (see #8, above), spending down assets, hiding assets, or engaging in any course of wrongdoing geared towards the divorce matter.

The possibilities are really endless, so it is important that you keep an eye out and understand that each of the above examples may (and I say "may" because some of the above claims may be truthful and legitimate) be designed to do nothing more than pressure you into an inequitable settlement that you may regret having to live with when you wake up the morning after that final judgment of divorce is entered by the Court.

_______________________________________

Robert Epstein is an associate in Fox Rothschild LLP's Family Law Practice Group. Robert practices in the firm's Roseland, New Jersey office and can be reached at (973) 994-7526, or repstein@foxrothschild.com. 

• Print
• Comments
• Trackbacks
• Share Link

Most people are aware that a supporting spouse may be entitled to modify an alimony obligation upon a showing of “changed circumstances.” However, many people do not know that the “leg-work” that they have to do to set themselves up to succeed on such a Motion begins long before the parties ever go to Court, especially if a supporting spouse is asking for relief on the basis of a purported job loss or reduction in income.

Below is a non-exhaustive list of items that a Judge will look for when a supporting spouse is requesting to reduce his or her alimony obligations:

• Has the applicant proven that his/her circumstances have changed such that he/she would be entitled to a child support or alimony reduction - Common scenarios constituting changed circumstances include:
       o A reduction in a party's income;
       o Illness;
       o Retirement;
       o The receipt of an influx of liquid assets;
       o Cohabitation of the supported spouse.

• Print
• Comments
• Trackbacks
• Share Link

As a continuation to my alimony-themed posts, the particular issue that is the subject of this blog post may come as a surprise to some supporting spouses; namely, the fact that the term and amount of a limited duration alimony obligation can be lengthened in some rare circumstances.

New Jersey Courts do have authority to modify the amount and term limited duration alimony. In the case of modifications of limited duration alimony, the alimony statute, N.J.S.A. 2A:34-23(c), provides as follows:

An award of alimony for a limited duration may be modified based either upon changed circumstances, or upon the nonoccurrence of circumstances that the court found would occur at the time of the award. The court may modify the amount of such an award, but shall not modify the length of the term except in unusual circumstances.

Rothfeld v. Rothfeld (App. Div. 2008), while unpublished, is just one example of this portion of the statute in action. In Rothfeld, the parties divorced after an approximately seven (7) year marriage. They had two (2) children: Jonathan, who was born on September 19, 1996; and Martin, who was born on September 15, 1998. Both parties were members of the New Jersey Bar and the husband had an active private practice. The wife had not returned to active practice, however, as a result of her parenting obligations with respect to the children, particularly Jonathan, which had prevented her from doing so.

In reaching their divorce settlement, the parties agreed upon “limited duration alimony” in the amount of $500 per week for four years, effective April 1, 2003. According to the wife, at the time the PSA was negotiated, “it was assumed that [she] would be able to obtain per diem work in the law field.”

• Print
• Comments
• Trackbacks
• Share Link

As a continuation to last week’s post regarding what happens when trial courts fail to grant hearings to supporting spouses when they may be warranted, i.e. upon a showing of changed circumstances, this blog post will focus on those times where a hearing is deemed unnecessary based on the facts of a given case. This sometimes occurs in situations where an obligor is self-employed, has the ability to control his or her income, and is attempting to capitalize on the down economy in order to wriggle out of support obligations, sometimes only a few short years after the initial support award.

This type of issue was addressed at length in a prior blog post by Eric Solotoff, Esq. in the context of a discussion of Donnelly v. Donnelly where a self-employed attorney was denied a reduction to his alimony obligation two years following the entry of the Final Judgment of Divorce based on a purported downturn in his law practice. In these types of instances, trial courts have followed the mantra that where the supporting spouse owns his own businesses, the income of the self-employed obligor must be viewed “more expansively.”

For example, in the 2010 case of Pisciotti v. Pisciotti, the defendant-husband appealed from an Order denying his motion to reduce his alimony obligations and to pay child support. At the time of their divorce in 1999, the parties entered into a Property Settlement Agreement (“PSA”) obligating the husband to pay $3,000 per month in alimony, as well as child support in the amount of $4,207.34 per month. Ten (10) years following the parties’ divorce, the husband filed a motion to reduce his support obligations, arguing that his income had substantially declined since the time of the divorce and that his assets, which included several heavily mortgaged properties, had decreased significantly in value. The husband also asserted that the fitness center business, in which he was a co-investor and employee, had suffered during the economic downturn, thereby diminishing his compensation therefrom. The husband supplied various materials in support of his motion, including an updated Case Information Statement, his certification, and personal tax returns. The former wife opposed the motion, arguing that the husband’s motion was not adequately supported, and therefore he had not established a prima facie change of circumstances.

• Print
• Comments
• Trackbacks
• Share Link

In this economy, you would be surprised to see how many judges are jaded by applications brought by supporting spouses to reduce their support obligations based upon a reduction in income. After all, some judges entertain these applications on their daily docket and oftentimes see supporting spouses who are simply attempting to capitalize on the down economy and lack any actual merit to their cases. This blog post will explore one of the reactions by judges to this type of application; namely, denying the request of the supporting spouse outright without even holding a hearing, taking testimony, and making credibility findings.

Support obligations are always modifiable by the family court upon application of the supporting spouse.  Typically, this type of application requires the supporting spouse to make a threshold prima facie showing that “changed circumstances have substantially impaired the ability to support himself or herself.” Lepis v. Lepis, 83 N.J. 139, 157 (1980). When such a showing is made, the Court must next determine if a plenary hearing is warranted. This is sometimes referred to as the two-step Lepis analysis.

• Print
• Comments (2)
• Trackbacks
• Share Link

When settling a case, the parties and their lawyers can be far more creative in settlement then a judge can be if the case is tried.  While family judges have wide discretion in their decision making, creativity is crafting the most beneficial result for both parties is rarely something they can do.  In fact, in many ways, they are constrained from the type of creativity that we see every day in divorce agreements. 

What if you are a high earner, but your income fluctuates greatly from year to year?  While a judge will likely have no choice but to determine your average income over 3 to 5 years and base support upon that as well as the rest of the statutory factors, you may want to agree on some kind of formula so that there is fairness year over year, i.e. you pay more in a better year and less in a down year. For example, if your average income is $2,500,000 but your income fluctuates between $1 million and $4 million per year.  You would really hate paying alimony in those years you only make $1 million.  If a judge decided this case using averages, you might be forced to pay your entire net income, or more, to you ex spouse in the down year.  Similarly, a judge could never say that support "automatically" is reduced or even reviewed if your income is less than $X in the future. 

This concept was reiterated again by the Appellate Division on October 29, 2012 in an unreported  (non-precedential) decision in the case of Means v. Snipes.  In this case, after a trial, the judge decided that in the event that defendant's annual income fell below $2 million, he would receive a reduction in alimony. This is the one thing that both parties agreed was in error - a rare agreement in a very contentious case.

• Print
• Comments
• Trackbacks
• Share Link

An interesting issue was recently considered by the Court in the case of Muller v. Muller. Specifically, the Appellate Division examined whether a husband could compel the sale of the marital home when he had conveyed his interest by way of deed about ten years earlier, but the parties’ Property Settlement Agreement (“PSA”) had provided for the husband’s continued ownership.

The parties in Muller were married for 17 years. When they divorced in 1990, they entered into a PSA, which, in part, provided as follows:

EQUITABLE DISTRIBUTION
A. Husband and Wife agree to divide equally the personalty . . . upon sale of the premises or child's emancipation, whichever shall first occur.
B. Upon execution of contract of sale of the above premises, Husband agrees to put his interest in the marital home in trust for Child.
. . . .

REAL ESTATE
A. Husband agrees to pay the mortgage payments [on the marital home] . . . until the time that child graduates from college, or reaches the age of 22, whichever shall first occur[.]

The husband paid the mortgage from the time of the divorce until around 1999 when he defaulted on the payments. The mortgagee instituted foreclosure proceedings in or around July of 2000. In order to avoid foreclosure, the wife borrowed about $60,000 and refinanced the property. The husband executed a deed and conveyed the wife his ownership interest in the property for consideration of $50,000. As a result, the wife exonerated him of the debt the he had incurred by defaulting on the mortgage payments. At the point, the child was 21 years old and had graduated from college.

• Print
• Comments
• Trackbacks
• Share Link

There have been countless occasions when a client, or potential client, asks me - "how can I modify my support?"  In these tough economic times, the question usually comes from the person paying support who can no longer afford to pay at the previous level.

My answer to this question is always the same - "It depends.  SHOW ME why you can't afford to pay it anymore."

The case law is illustrative.  A party seeking to modify support must "demonstrate that changed circumstances have substantially impaired" the payor's ability to meet the previously set obligation (Lepis v. Lepis).  The party seeking the modification must file a motion in court, attaching proof of these "changed circumstances."  Thereafter, the court must conduct a hearing if: (1) the party proves a "prima facie" case (translation: case at first blush) of changed circumstances; and (2) there are genuine and substantial issues in dispute.

I recently won an appeal in the Appellate Division, where the trial court denied my client's request to modify his child support.  In Palardy v. Prata, the parties were divorced in 2004.  My client agreed to pay $413 per week in child support, which was based upon him earning an optimistic $175,000 per year.  Unfortunately, by 2008, he was in arrears.  He simply could not find a job that would allow him to meet his own basic expenses, let alone pay $22,000 per year in child support.  In December 2009, we filed a cross motion to reduce his child support.  We attached tax returns showing that his income from 2004-2007 was substantially less than $175,000 as well as evidence documenting his efforts to obtain better employment. 

So, was this enough?  The trial court said NO.  The Appellate Division said YES.  My client should have at least been entitled to a hearing.  According to the Appellate Division, the $175,000 per year in income that was the basis of the support award was a "fiction".  Moreover, it was undisputed that my client never earned this amount. 

What we take from this case is that documented proof is the key to modifying support - more so than a "fictitious" (or imputed) income figure used to calculate the initial support order.  If you are seeking to modify your support, you must be prepared to provide proof of what you claim to be the actual circumstances.  Your word isn't enough.

• Print
• Comments
• Trackbacks
• Share Link

What happens when an asset divided in equitable distribution really isn't worth what you think it was?  That was an issue in the Simkin case that I have blogged about in the past about involving the Madoff investment account.  I even participated in a pod cast on this case. It was also an issue in the Andrews v. Andrews case that was decided by the Appellate Division on July 15, 2011.

In that case, involving parties with a reported net worth of $19 million and a husband with a several million dollar a year income, the parties settled the case dividing their assets and as a result of the asset division, the husband had no direct alimony or child support obligation.  One of the assets that the wife was supposed to receive was approximately $1.1 million from the sale of stock in a private bank.  However, for whatever reason, the stock was never sold, the value of the shares because worthless and the wife never got her money.  It is no surprise that the parties wound up back in court. 

The trial judge found that there was mutual mistake made by the parties and re-formed their agreement by requiring the husband to pay the wife half of the value that the parties previously believed the stock to be worth, plus interest.  The husband, of course, appealed, arguing that he never guaranteed that the wife was going to get the amount that parties believed the stock to be valued at. 

The Appellate Division affirmed the decision.  Of note, in response to the husband's argument that wife waiting too long (more than one year) to raise the issue of mistake, the Appellate Division interestingly noted that the agreement regarding equitable distribution was a substitute for child support and alimony and as such, since child support cannot be waived, the waiver/delay argument must fail as to child support.  Similarly, alimony and child support are both subject to modification based upon changed circumstances.

In this case, the lesson, if any to be learned, is that distributions of property in lieu of support could possibly be modified after the support was prepaid.  However, if you want a chance at making the agreement enforceable, you have to make sure that the property actually gets distributed.

__________

Eric Solotoff is the editor of the New Jersey Family Legal Blog and the Co-Chair of the Family Law Practice Group of Fox Rothschild LLP. Certified by the Supreme Court of New Jersey as a Matrimonial Lawyer and a Fellow of the American Academy of Matrimonial Attorneys, Eric practices in Fox Rothschild's Roseland, New Jersey office though he practices throughout New Jersey. You can reach Eric at (973)994-7501, or esolotoff@foxrothschild.com.

• Print
• Comments
• Trackbacks
• Share Link

Oftentimes, issues of custody and parenting time are the most difficult and sensitive decisions that a judge in the family part must make. It involves deliberation of the ever-elusive “best interests of the child” – a question with no right or wrong answers. While the standard is ostensibly subjective, there are certain guideposts that a judge must look to in order make the difficult determinations that come along with issues of custody. Those factors, as set forth in N.J.S.A. 9:2-4(c), include: 

1. The parents' ability to agree, communicate and cooperate in matters relating to the child;
2. The parents' willingness to accept custody and any history of unwillingness to allow visitation that is not based upon substantiated abuse;
3. The interactions and relationship of the child with its parents and siblings;
4. Any history of domestic violence;
5. The safety of the child and the safety of either parent from physical abuse by the other parent;
6. The preference of the child if the child is of sufficient age and capacity to reason so as to make an intelligent decision;
7. The needs of the child;
8. The stability of the home environment offered;
9. The quality and continuity of the child's education;
10. The fitness of the parents;
11. The geographical proximity of the parents' homes;
12. The extent and quality of the time spent with child prior to or subsequent to the separation;
13. The parents' employment responsibilities;
14. The age and number of children.

As can be seen in the recent case of Vidal v. Gelak (an unreported/non-precedential decision), when judges do not examine these all-important factors, their decisions face reversal and remand on appeal. 

• Print
• Comments (3)
• Trackbacks
• Share Link

It is typical for divorce agreements to contain a provision requiring an alimony payor to maintain life insurance to secure his alimony obligation and one, if not both parents to maintain life insurance to secure their obligations to their children.  In fact, Jennifer Millner, a contributor this this blog, and a partner in our Princeton office, recently did a post entitled Child Support Obligations Live on After Death, addressing what happens when a support obligor does not have the required life insurance at his death.

It is also typical for someone to cover their life insurance obligations through insurance they get as a benefit of their employment.  Many companies, for example, offer as a benefit, life insurance - one times their salary, three times their salary - for example.  What happens when someone leaves their job and loses this life insurance?

That issue was addressed by the Appellate Division in an unreported (non-precedential) opinion released on April 1, 2011 in a case entitled Starr v. Starr.  In this case, to secure his alimony, in the divorce agreement, it provided that, "Defendant shall designate plaintiff as a beneficiary of $150,000.00 of the proceeds of the group life insurance made available to him through his employment."  However, in 2005, he was given notice that his employment was terminating.  He did have the option of converting his group life insurance to an individual policy but he did not. 

• Print
• Comments
• Trackbacks
• Share Link

As a follow up to my blog post of last week, this week the Appellate Division came down with yet another cohabitation decision. The case of Pizzuti v. Proctor was decided on March 31, 2011. In Pizzuti, the wife appealed from a decision wherein the trial court terminated her former husband’s alimony obligation of $100 per week on a finding of changed circumstances based on the wife’s cohabitation with an unrelated male.

At the trial level the husband submitted a myriad of proofs that the wife was cohabitating in support of his obligation to terminate alimony. His efforts were for naught however, because the fact that she was cohabitating went completely uncontested. Indeed, in response to the husband’s allegations, the wife stated as follows: "I will spare the Court the trouble of scheduling a plenary hearing because I admit that I do cohabitate with Mr. Argenzio at his home, located [in] Ramsey, New Jersey and have been since 1999." However, as I stated in my previous blog, proof of cohabitation is only half the battle. The next inquiry is whether, by virtue of the cohabitation, the wife was economically dependant on her new paramour. In New Jersey, the fact of economic dependence is presumed upon a showing of cohabitation, and it is incumbent the cohabitating spouse to prove otherwise.

• Print
• Comments (1)
• Trackbacks
• Share Link

It is well-settled law in New Jersey that child support and alimony awards are always modifiable. While there is an abundance of case law in the area of post-judgment modifications of support obligations, particularly in this economic climate, the most often cited case for modification is the seminal New Jersey case of Lepis v. Lepis, 83 N.J. 139 (1980). Indeed, the Lepis Court was the first in holding that when changed circumstances substantially impinge upon the supporting spouse’s ability to pay support at the level ordered, a modification of the support order might be necessary. The burden to prove this change in circumstances falls upon the supporting spouse when such a downward modification is sought.

A reduction in the supporting spouse’s income has long been recognized as a changed circumstance warranting a support modification, so long as it is not temporary in nature. In addition, the recent Appellate Division case of Angelastro v. Angelastro, recently solidified the notion that a support modification may be sought when the supported spouse’s economic circumstances change for the better.

In Angelastro, the parties’ property settlement agreement, executed in September of 2008, awarded the wife alimony as follows:

The [h]usband shall pay to the [w]ife[,] starting at the sale of the marital home[,] the sum of $350[] a week in [a]limony commencing for a period of six (6) years. Upon the completion of aforementioned six (6) years[,] the [h]usband's [a]limony obligation shall reduce to that of $200[] and continue for a period of eight (8) years thereafter representing a total payment period of fourteen (14) years.

In addition, child support in the amount of $200 per week was provided for. The parties’ property settlement agreement specifically predicated the above support awards upon the wife’s imputed income of approximately $25,000.

• Print
• Comments
• Trackbacks
• Share Link

This blog post is written with input from Eliana T. Baer, who, along with Robert A. Epstein, was instrumental to the outcome of the below case. I thank them both for their extensive time and efforts, without which this result would not have been possible.

An important reported decision was decided by the Appellate Division concerning the distribution of post marital contribution of pensions and retirement plans. A copy of the case can be found here. While the case itself concerned a former service member’s military retirement pay, the matter has wide implications for all retirement plans which are not distributed at the time of divorce. This was a case which I had alluded to in a previous blog which can be found here, and in which we represented Thomas Barr, who had earned credits toward a military retirement during his marriage. In the case of Barr v. Barr, the parties were divorced after the husband, Thomas, had served eleven years of active duty in the Air Force. Thomas was not represented by counsel at the time of the divorce and his wife’s attorney prepared a property settlement agreement which provided that "The Wife will receive 50% of Husband's pension benefits attributable to his 11 years in the military service only. Such benefits are to be distributed when Husband commences receiving same." After the parties divorce, Thomas went on to enroll in the reserves and during that time, accumulated enough time to entitle him to military retirement pay.

When Thomas began receiving his retired pay, he calculated what he believed he owed his former wife, Judith, and made a deduction for taxes that he had to pay. This went on for a period of time, and the parties had a disagreement and Thomas ceased paying. When Judith made an application for enforcement, Thomas realized that the amount that he had been paying was what he believed to be the incorrect amount, and in his response to her motion, asked that the amount be adjusted. Specifically, he argued, in part, that because the formula used to calculate retired pay benefits considers a military member's rank pay at retirement as well years of service, it was possible to calculate the amount that was attributable to his rank at the time of the parties’ divorce, which would give meaning to the agreement of the parties that Judith would only be entitled to the portion attributable to his active duty. A service member receives points for each day of military service: one point for each day of active military service and two points for each day of reservist duty. Additional points accrue based on the completion of certain training, drills and funeral honors duty. The actual member's benefit is the product of the base pay for the rank achieved at retirement and two-and one-half percent of the points representing the years of service credited.

• Print
• Comments
• Trackbacks
• Share Link

In Feldman v. Feldman, an interesting new unreported (not precedential) opinion from the Appellate Division, the Court addressed the issue of a child's religious education, and whether the parties had already settled the extent of such education in their previously entered custody and parenting time agreement.  It is only coincidental that the parties here share the last name Feldman, since it was an earlier reported Appellate Division decision of the same name holding that the Parent of Primary Residence - defined as providing a residence for a child for more than 50% of overnights annually (or, if sharing is equal, providing the residence for the child while the child is attending school) has the right to determine the child's religious upbringing and education. 

Here, the parties were divorced in 2005, coming to terms on a custody and parenting time agreement that provided Mom with the ability to make "all decisions regarding the child," (except when the child was in his care) and that she would "give advance notice" to Dad as to major decisions so as to give him enough time to voice any objection or file a motion in court.  The parties also acknowledged in a separate provision that the child attended Jewish day school and that she would continue to do so.  To that end, the parties also agreed to cooperate with the school in providing all financial information so as not to impact enrollment.  Separately, the trial court appointed a parenting coordinator to assist the parties with issues regarding the child. 

• Print
• Comments (2)
• Trackbacks
• Share Link

In an interesting unreported opinion in the case of Tiger v. Tiger released on April 21, 2010, the Appellate Division affirmed an Order enforcing a Property Settlement Agreement and post-judgment Consent Order and denying the husband's request for an ability to pay hearing regarding alimony and the remainder of his equitable distribution obligation.

After a 35 year marriage, the parties were divorced in 2005 and the husband was required to pay short term alimony and $150,000 in equitable distribution over 4 years.  The husband failed to pay his 2007 and 2008 obligations but never filed a motion seeking modification.  The wife, however, filed an enforcement motion in 2007 and the husband was ordered to pay the $40,000 owed.  The husband filed a motion for reconsideration wherein his alimony was reduced from $70,000 to $50,000 and he was granted more time to pay his equitable distribution payment.  He then failed to pay his 2008 equitable distribution payment and another enforcement motion ensued.  A plenary hearing was ordered as a result but the hearing never happened because the parties entered into a Consent Order wherein the husband agreed not to seek to modify the equitable distribution again and not to seek to modify the alimony before 1/1/10. Not surprisingly, he failed to comply and another enforcement motion was filed in late 2008. The husband used the economic situation in the real estate industry as a reason for his non-compliance.  The trial court denied his motion finding that the husband was a sophisticated business man who entered into the consent order will full knowledge of the economic situation in the real estate industry.  The appeal ensued.

• Print
• Comments
• Trackbacks
• Share Link

A recent case was filed concerning a woman who entered into a Marital Settlement Agreement with her then husband in which the marital home was not to be sold immediately, but provided for how the proceeds would be distributed when it was. The Husband, however, was in poor health, and the agreement did not provide for the possible event of his death prior to sale of the home. In fact, the husband died prior to the sale of the house, but after the limited divorce that the couple had obtained .  His interest in the house went to his estate rather than to his former wife as she had anticipated. The former wife was then forced to purchase the half interest from the estate in order to retain the home, something that was not anticipated by her, and cost her a significant amount of money.

I am sure that the former wife assumed that the deed to her home contained a right of survivorship in the event of her former husband’s death. Instead,  the property was most likely titled in such a way that the parties owned the property as tenants by the entirety, which means that they owned as husband and wife, and upon the death of one spouse  title of the property would go to other, assuming they were still married. Upon the divorce of parties to a tenancy by the entirety,  however, the title changes to what is known as a tenancy in common, which means that they each had a one half interest in the property which would then go to their beneficiaries upon death unless there is a specified right of survivorship.

The moral of this story? Make sure your lawyer has a copy of your deed as well as any other important documents.   If you do not have one, make sure that a title search is conducted on the property.   It is critical that a lawyer understand how property is held between spouses and/or other co-owners. Many times, incorrect assumptions are made about these kinds of issues and the results can be expensive. My motto is, I can never have to much information from my client.

• Print
• Comments
• Trackbacks
• Share Link

Oftentimes parties will sign an agreement settling all issues in their divorce matter only for one party to subsequently try to back away from those terms for any number of reasons.  Is it just that easy for a party to essentially change its mind?  The simple answer is generally no.  New Jersey has a strong public policy favoring the enforcement of fair and equitable agreements entered into on a consensual and voluntary basis.  If the agreement is somehow the product of fraud, unconscionable or otherwise demonstrates one party's effort to take advantage of the other, then the law provides the wronged party with an opportunity to "set aside" or "vacate" the agreement.  

What about those cases where there is no such wrongdoing?  Since marital settlement agreements are contracts and, as a result, generally enforced, Courts in this State will look to the terms of the agreement and apply basic contractual principles when addressing one party's claim as to the agreement's (or that provision's) enforceability.  For instance, where the agreement's language is unambiguous and the Court is called upon to interpret the terms at issue, the Court will not consider external (or "parol") evidence, such as, perhaps, oral discussions had at the time of the agreement's signing.  It will simply apply and interpret the terms before it.

This was the case in Dell'Osa v. Dell'Osa, a recent, unpublished (not precedential) Appellate Division decision where the husband claimed that the trial court improperly divided the parties' retirement accounts because his accounts were comprised of pre-tax funds while the wife's were comprised of after-tax funds.  The husband claimed that, as a result of this account structure, two Orders (known as Qualified Domestic Relations Orders or "QDROs") were needed to fairly divide the accounts, rather than just the Court dividing the accounts without such an Order to his claimed monetary disadvantage.

Affirming the trial court's decision, the Appellate Division found the settlement agreement language unambiguous as to this issue, finding that the agreement merely acknowledged the pre-tax and after-tax retirement contributions of the parties without requiring any equitable distribution to factor in a tax adjustment.  In its affirmance, the Appellate Division emphasized the notion that "A court may not make a better contract for either party than the one the parties drafted."  The Court also looked to other terms of the agreement in concluding that its interpretation of the unambiguous language was consistent with the terms of the agreement as a whole.

• Print
• Comments
• Trackbacks
• Share Link