Posted on September 28, 2009 by Jennifer Weisberg Millner

One Client, One Lawyer

A common misconception in New Jersey is that both spouses can use the same attorney for their divorce.  My local paper recently had an article about divorces in the current economy.  One attorney was quoted as intimating that this was true; the attorney was speaking of uncontested divorces in which the parties agree on issues and the seek the dissolution of their marriage. While I am certain that the attorney’s comments were taken out of context, as one of the points in the article was a concern about legal fees, this is a question that comes to me often.  A client will ask me if I can represent both spouses, even if they have an agreement.  The answer is a resounding, no.

 

The ethics rules in our state are very clear that one attorney cannot represent both spouses in a divorce.   Simply, it is a conflict of interest.  The New Jersey Supreme Court has said on many occasions, that “one of the most basic responsibilities incumbent on a lawyer is the duty of loyalty to his or her clients. From that duty issues the prohibition against representing clients with conflicting interests."( In re Opinion No. 653 of the Advisory Comm. on Prof'l Ethics, 132 N.J. 124, 129 (1993)).  Our state has a very strong policy in which there should not be even an “appearance” of a possible conflict of interest.  This is to protect the clients.

 

Imagine a scenario in which one spouse has been home raising children, and the other has been working throughout a twenty year marriage.  This is a situation in which alimony will be an issue.  Certainly, the non working spouse and the working spouse may have differing positions about the amount and term of alimony. Most people agree that in these circumstances, the parties will want to have their own attorneys.  But what about the situations where both parties are working, and they have a house and a couple of retirement accounts.  Many people believe that in this situation, they do not need two attorneys and both use the same lawyer.  Well, they can’t. 

There are many times in what is deemed to be a “simple divorce” that a conflict of interest could arise. This does not mean that one party is trying to “get one over” on the other; it could be a situation in which the parties reach an agreement and simply do not understand all of the applicable issues. Take this example ( which happened to me several years back): husband and wife agree that she is going to take the house which has $100,000 in equity. Husband will take the investment account which has a value of about $100,000. 50-50 split, right? This is what they want to do. Well, it’s maybe not quite so fair, because in my example, it turns out that the investment account contains stocks that they received twenty years ago for a wedding present and there will be significant tax consequences such that husband will really only get $70,000 in after tax dollars. Take the example of a pension. Usually the parties divide the interest which was accrued during the marriage. But what about the beneficiary designation? That designation could have significant consequences on a spouse who remarries later on.

 

These is just two of thousands of examples of why each party should get independent advice in a divorce. Most cases settle and an agreement is drawn up. But the essence of a settlement is compromise, which means that each side will give up something that they are otherwise entitled to in order to reach a settlement that they are satisfied with. How can the same lawyer advise the clients what to give up without creating a conflict? It cannot be done, which is why one attorney cannot represent both spouses in a divorce.

 

That being said, there are many, many times that I am retained to review an agreement that has been prepared by another lawyer, or a mediator. And in some of those occasions, I may not recommend any changes. But at least each person has had the opportunity to make sure that their rights are protected. Sometimes, a client will come in and say that she(or he) and the spouse have worked out an agreement between themselves and only want to use one attorney. I advise my client of all the implications of the agreement. I then prepare an agreement with the terms (as they may have been modified after I have given the client my opinion), and send it to the other spouse with a stern letter advising that spouse to have an attorney review the agreement before signing it. If that spouse waives his or her rights, and does not seek to see a lawyer for advice, I note that fact in the agreement. This is to protect my client against a potential challenge to the agreement at a later date on the basis of that other spouse not having legal advice. Then, once the agreement is signed, the matter proceeds on a “uncontested basis.”

 

The fact of the matter is that the vast majority of lawyers understand that their clients are conscious about the fees that they spend for a divorce and make every effort to work efficiently while at the same time making sure that the client is educated about his or her rights and protected.
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Posted on August 4, 2009 by Eric S. Solotoff

15 YEAR MARRIAGE NETS PERMANENT & REHABILITATION ALIMONY - BUT REMAND ON IMPUTATION OF INCOME TO WIFE

In an interesting unreported decision released on August 3, 2009 entitled Mathias v. Mathias, a wife was granted both permanent and rehabilitation alimony after a 15 year marriage. 

In this case, the husband was a state trooper.  The wife had cared for the children, by agreement, though she had worked on and off as a cosmetologist.  She was attending college seeking to be a registered nurse at the time of trial.

The trial judge imputed two income figures to the wife.  One as to what she was earning at the time and what she could earn in the future as a nurse.  The matter was reversed and remanded for further consideration as to both.  For the current income, there was a finding that the wife was underemployed yet the Court used her current income.  For the future, the statistics from the department of labor as to what a registered nurse could earn were used. 

The Appellate Division stated:

However, Danielle has not held a full time job since the children were born. She has never worked as an RN, has no experience in the health care field, and has no specific prospective employers. There was no evidence that the yearly income imputed by the trial judge was an appropriate rate for an inexperienced, recently licensed RN in New Jersey. In short, although the judge used the appropriate source for imputing income, he did not take other significant, relevant
factors into consideration.

The wife unsuccessfully appealed her request to impute more income to the husband than he was currently earning but which was consistent with prior history. Interestingly, a consideration in not imputing more income for overtime to the husband was his desire to spend more time with the children, which the Appellate Division deemed relevant and appropriate.
 

Of more significance to me, but a fact that was not appealed is that the wife was awarded permanent alimony after a 15 year marriage.  15 years has, of late, been deemed a mid term marriage and there has been some debate as to whether permanent alimony was merited in a 1 year marriage.  This case may be one that can be used to convince a judge who is on the fence.

 
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Posted on July 8, 2009 by Eric S. Solotoff

APPELLATE DIVISION FINDS THAT 9 YEAR MARRIAGE DOES NOT MERIT PERMANENT ALIMONY - PREMARITAL COHABITATION COUNTS TOWARD LENGTH OF MARRIAGE

In an interesting unreported decision released yesterday in the case of Christopher v. Christopher, the Appellate Division reversed a trial court opinion granting the wife permanent alimony. 

The parties were married 2006 and the Complaint for Divorce was filed in December 2004.  Interestingly, the trial court found and the Appellate Division affirmed the tacking of the period of premarital cohabitation to the length of the marriage.  Thus, the 8 year marriage became a 9 year marriage. 

Even still, the Appellate Division found that the relationship was simply too short to award permanent alimony.  Rather, citing the reported Cox decision, the Appellate Division again noted:

limited duration alimony is not intended to facilitate the earning capacity of a dependent spouse or to make a sacrificing spouse whole, but rather to address those circumstances where an economic need for alimony is established, but the marriage was of short-term duration such that permanent alimony is not appropriate. Those circumstances stand in sharp contrast to marriages of long duration where economic need is also demonstrated. In the former instance, limited duration alimony provides an equitable and proper remedy. In the latter circumstances, permanent alimony is appropriate and an award of limited duration alimony is clearly circumscribed, both by equitable considerations and by statute.

The Appellate Division in Christopher deemed this to be a marriage of short duration.  Moreover, despite finding that the husband (a medical doctor) will probably earn more in the future and the wife (a personal trainer) will probably not earn enough to maintain the marital lifestyle in the foreseeable future, those facts alone don't justify permanent alimony in a marriage of short duration.

While not precedential, this case is instructive because it is not unlike many cases that we see and that come before the Courts.

 

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Posted on July 2, 2009 by Robert A. Epstein

LIMITED DURATION ALIMONY - FOR HOW MUCH AND HOW LONG?

For about a decade, Limited Duration Alimony (LDA) has been an available form of alimony in New Jersey.  The questions often asked regarding LDA is, when should it be awarded and, relatedly, for how much and how long? 

These questions were recently addressed in the unpublished Appellate Division opinion of Elliott v. Prisock-Elliot, decided on June 2, 2009.  Generally, where one spouse is economically dependent upon the other at the end of a marriage, an alimony award helps the dependent spouse achieve a lifestyle "reasonably comparable" to that enjoyed during the marriage.  Several factors are included in a Court's alimony determination under N.J.S.A. 2A:34-23, including, but not limited to the dependent's spouse's needs and ability to fulfill them, and the other spouse's ability to contribute.

LDA, though, is specifically intended to address a dependent spouse's economic need for support where the marriage reflected a true partnership, but the marriage itself was too short in duration for a permanent alimony award, and the dependent spouse needs neither education nor job training to return to the workforce that would potentially merit a rehabilitative alimony award.  LDA essentially aids the dependent spouse who has the education/job skills to have a career, but devoted efforts instead to the marriage and allowed the other spouse to increase their own earning capacity at the same time. 

The Appellate Division found that the trial judge in Elliott failed to adequately consider the alimony factors and the purpose of LDA in granting its award of 10 years of LDA at $30,000 per year on a marriage of less than 10 years at the time the complaint for divorce was filed and approximately 12 years when the dual judgment of divorce was entered.  Specifically, the Appellate Division noted the trial court's error as to the length of the marriage; its complete lack of findings as to each spouse's marital contributions other than that each had worked on their own to care for the children; and its insufficient assessment of the dependent spouse's need for alimony and the other spouse's ability to pay.  The trial court's decision on alimony was reversed as a result.

While LDA should not be awarded as a substitute for permanent alimony when a permanent award is appropriate, a proper LDA determination requires a careful look at each fact-specific case and how those facts mesh with the statutory alimony factors in New Jersey, as well as a consideration of LDA's overall purpose in aiding a dependent spouse in need.  Also, while the amount of an LDA may be modified, N.J.S.A. 2A:34-23(c) prohibits modification of the length of the LDA term except in the case of the broadly termed "unusual circumstances."

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Posted on March 20, 2009 by Eric S. Solotoff

ANOTHER CELEBRITY DIVORCE - HOCKEY STYLE

This was a good and bad week for Martin Brodeur, the goalie for the New Jersey Devils.  On a good note, he passed Patrick Roy as the all time winningest goalie in NHL history.  On a bad note, he lost his appeal of an alimony award in the Appellate Division.  To see the opinion, click here. This is the second appeal in this case.  To see the opinion in the first appeal, click here.

This was a 7 1/2 year marriage from the date of marriage until the date of separation.  It was clear that it is was the parties' intention that the wife would be a full time, stay at home caretaker of the children.

In the first appeal of this case, the Appellate Division affirmed the award of alimony to Melanie Brodeur in the amount of $500,000 per year but reversed the award of permanent alimony.  In this case, the Appellate Division affirmed the award of limited duration alimony until the youngest child graduated from high school.

In the first appeal, the Appellate Division held that:

limited duration alimony is particularly suitable for a situation such as here when the marriage was of short to intermediate duration and the woman is young and has young children. The judge is able to fashion an award that provides financial support to the former wife while she cares for the children.

The Court then addressed the factors that should  be considered in the decision of the length of the term, as follows:

The term should be informed not only by the age of the children, but also by the parties' decision that plaintiff should be the primary and full-time caretaker of the children.

 

In the remand proceeding, Melanie sought alimony through the graduation of her youngest child from college in 2024.  Martin wanted the alimony tied to the continuation of his career. 

Martin signed a six  year, $31.2 million contract extension  in January 2006 (after the divorce), which will take him to the end of the 2011-2012 hockey season.  To put this in perspective, during the term of this contract, he will earn more than $31.2 million, not including endorsements and any other income that he may have but only pay $3 million in alimony. 

The judge rejected Martin's position and granted alimony through he youngest child's graduation from high school, given that the parties contemplated that Melanie would be the full time caretaker of the children.

The Court also rejected Martin's argument that tying the term to the age of a child or life event, such as college graduation, would "masquerade" alimony payments as non-deductible child support in
violation of the federal tax code. 

The Appellate Division noted that the duration in this case was longer than typically seen in the reported decisions regarding limited duration alimony, however, given the parties' expectations regarding Melanie being the caretaker, and the fact that Martin could afford to pay the alimony lead to this long term of limited duration alimony.

The Court also reiterated that the issue of the term and amount of the limited duration alimony are separate issues and further, "nothing precludes a motion to reduce the amount of alimony once defendant retires and his post retirement employment and income is known."  However, given Martin's income set forth above, I think he will be hard pressed to successfully seek a reduction in alimony when he retires from hockey.  Given his income for the remainder of his hockey career, he should have the ability to pay the alimony thereafter.  In addition, should he make a motion at that time, I believe that Melanie would have a good argument that Martin was aware of his obligation and the fact that the career of a professional athlete is limited and thus, should have saved accordingly.  Given the litigation in this case, no doubt we will be reading about this case again in 11 years, if not sooner.
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Posted on January 27, 2009 by Eric S. Solotoff

APPELLATE DIVISION REVERSES AWARD OF PERMANENT ALIMONY GRANTED IN AN 11 YEAR 9 MONTH MARRIAGE

In an interesting unreported decision in the matter of Valente v. Valente, on January 27, 2009, the Appellate Division reversed the award of permanent alimony to the wife after an 11 year 9 month marriage.  To view the full text of the case, click here.

The relevant facts are as follows:  During this 11 3/4 year marriage, the court deemed that the marriage was "traditional"  in that the husband was the sole income earner while the wife was the homemaker and caretaker of the three children. The husband  was a successful businessman who owned fifty percent of an insurance agency. He earned an average of $323,000 over three years prior to the filing of the complaint not including perquisites addressed brief in the opinion.  The wife had  a high school degree and worked in the clothing industry after high school until just before the birth of her first child, earning about $24,000 per year.

In reversing the aware of permanent alimony, the Appellate Division held:

"In our view, alimony of limited duration is appropriate in this case. The marriage of eleven years and nine months was of intermediate length. Considering plaintiff's age and intelligence as well as the fact that her children are both of school age, we see no reason why she cannot obtain employment within a reasonable time, and an award of limited duration alimony will give her incentive to do so. Moreover, at the end of a limited alimony term, plaintiff may seek permanent alimony or an extension of limited alimony if her earnings are insufficient to maintain her lifestyle without alimony."

 

This case in interesting in many respects. First, in a reported case, Hughes v. Hughes, a 10 year marriage was considered to be long term.  However, that case was decided before the limited duration alimony statute was passed.  As such, at that time, the court's really only had to options, permanent alimony and rehabilitative alimony.

More interesting is that the decision seemingly mis-states the law with regard to limited duration alimony when the court states that at the end of a limited alimony terms, the plaintiff can seek an extension or permanent alimony.  In fact, the alimony statute, N.J.S.A. 2A:34-23 (c) states:

"... An award of alimony for a limited duration may be modified based either upon changed circumstances, or upon the nonoccurence 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." 

Further, given that the wife is a high school graduate who has been out of the workforce for many years and did not earn a significant income while working, it seems extremely unlikely that her earnings in the future will be sufficient to allow her to maintain the marital lifestyle.

In reality, maybe the court should have simply said, whether or not she can maintain the lifestyle when the alimony end, is of no moment.  Rather, this is a mid term marriage for which permanent alimony is not justified and that she is on her own after the arbitrary number of years of limited duration alimony she will ultimately receive. 

 
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Posted on September 5, 2008 by Eric S. Solotoff

WHEN PERMANENT ALIMONY MAY BE UNFAIR - PART I

In the September 2008 ABA Journal, there was an article entitled 'Til Death Do Us Pay? As retired boomers head to the golf course, courts look at limits on alimony by Wendy N. Davis.  Discussed in that article is alimony after long marriages when the parties are nearing retirement age. This article got me thinking of a scenario we see in New Jersey frequently enough to make it worthy of discussion. 

Picture a 30+ year marriage where one party was the major breadwinner and the other did not work outside of the home (or if he or she did, there was a substantial disparity in incomes).  The knee jerk reaction is to say that this is a permanent alimony case, without question.

Now picture that there are substantial assets, including substantial retirement assets, that are going to be equally divided.  Does that change the assessment?  Maybe.

Now picture that each party is 62 years old.  Does that change the assessment? Maybe it should.
 

Presumably, the parties had discussed and considered retirement.  Even if they did not discuss it, retirement at 62 or 65 or 67 or some other reasonably anticipated age is not a far fetched concept.

In this case, one would expect that the alimony award entered could possibly equalize the parties' net incomes.  Even if it did not, the parties would likely be reasonably close in net income.  They will also have the same amount of assets.

Will the paying spouse be able to acquire substantially more assets in the few years before retirement? This is unlikely.  As the aforementioned article mentioned, will he be forced into "indentured servitude" to pay alimony so that the other spouse can be retired?  If so, is that fair?

The problem when negotiating settlements in these cases when representing the wage earner is that the other side will usually cling with a death grip on the notion of permanent alimony.  On top of that, in many cases, they will not even agree to language which gives the wage earner a right of review upon retirement - essentially leaving them to their devices to make a motion showing a change of circumstances (as opposed to skipping to step 2 which would be the financial analysis regarding whether the payor can still pay alimony based upon income and assets acquired post-divorce). 

This would seem contrary to the admonition that Judge (now Justice) Long included in a seminal case regarding retirement as it relates to alimony.  Specifically, she urged that it would be prudent to negotiate the retirement issue in a marital settlement agreement.  Despite that admonition, this is often easier said that done.

When it is not in the settlement agreement and the parties divorce at age 62, I can envision a defense to the retirement motion made just a few years later that "we agreed to permanent just a few years ago and retirement as foreseeable."  In short, the notion of permanent alimony will have been used as a shield and a sword. 

In any event, might it make more sense to agree to alimony for a term of years, with either a review at a certain age, unless the wage earner continues to earn as he/she has in the past and then it would continue until retirement.  While I know that few would agree to an automatic termination at retirement, shouldn't discovery and a financial review be automatic at this point.  While people always talk about wanting to avoid or narrow litigation - this would be a way to do it.  That said, it would be unusual to see someone giving up the advantage of the permanent alimony "right" without getting something back in return.  Under these facts, is that fair?

 

 

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