Is Alimony Reform On Its Way in New Jersey

There has been an alimony reform movement that has been gaining traction throughout the country.  Some of the major concerns appear to be this issue of permanent alimony and the lack of uniformity in alimony awards, both in amount and duration, from case to case.  In the recent past, alimony laws have been reformed in Florida, Massachusetts and Maryland.  Is New Jersey next?

On March 7, 2013, A3909 was introduced in the New Jersey Assembly, which, if passed, would radically change alimony as we know it in New Jersey. 

The following are a highlight of the changes:

  • All references to permanent alimony are deleted from the statute, though, as noted below, for marriages of more than 20 years, an indefinite award of alimony can be be granted

 

  • The concept of imputing income to someone that is unemployed or underemployed, which already exists in the case law and child support guidelines, would be codified

 

     

  • The amount of limited duration alimony should not exceed the recipient's need or 30 to 35 percent in the difference between the parties gross incomes at the time of the initial award, though a court would have the discretion to deviate.  Some reasons for deviation would be advanced age, chronic illness, unusual health circumstances, whether the payer is providing or ordered to provide health insurance to the recipient, sources and amounts of unearned income not allocated in equitable distribution, the recipient's inability to become self-supporting based upon the abuse of the payer, and others, including a catch all "any other factors that a court deems relevant and material."

 

  • The case law regarding cohabitation would essentially be codified.  Specifically, alimony could be modified, suspended or terminated if the other party has cohabited for 3 months.  Economic dependence would still be considered.  In addition, if suspended and the cohabitation ends, alimony could be reinstated, but the original terms cannot be extended.

 

  • Rehabilitative alimony cannot be for more than 5 years.  The case law regarding extending rehabilitative alimony would seemingly be codified to allow it to be extended if the recipient attempted to become self supporting but was unable to do so because of unforeseen events and, extending it would not constitute an undue burden on the payer.

 

  • Presumptive schedules for duration would be established, as follows:
    • 0-5 years - not more than half the number of months of the marriage
    • Greater than 5 years to 10 years - not more than 60% of the number of months of the marriage
    • Greater than 10 years to 15 years - not more than 70% of the number of months of the marriage
    • Greater than 15 years to 20 years - not more than 80% of the number of months of the marriage
       
    • More than 20 years - the court has the discretion to award alimony for an indefinite amount of time.

 

  • If you think that indefinite means permanent alimony, think again because alimony shall terminate upon the payer obtaining full retirement age which is defined as when the payer is eligible for the old age retirement benefit under the Social Security act.  Arrears accrued to that point would still be due and owing.  The payer's ability to work or decision to work past the retirement date shall not constitute grounds to extend alimony in most circumstances.

 

  • The bill would permit modification of alimony awards existing on the effective date to conform to the provisions of the bill. Limited duration and rehabilitative alimony awards could be modified to conform to the durational guidelines provided in the bill, and permanent alimony awards could be converted to limited duration alimony awards and modified to conform to the durational guidelines for limited duration alimony. A motion for modification could be brought by either party to the award and the moving party would not need to show a change of circumstances to receive a modification. The bill additionally provides that its enactment would not constitute a change of circumstances for the purposes of modifying the amount of an existing alimony award and it would not permit modification of an award that the parties previously agreed could not be modified.

Is this really a radical change, or in many respects, does it simply codify what is often done in practice anyway?  Will it really take away advocacy when circumstances so require?  More on these questions in a later post. 

 

Stay tuned for that and updates on the progress of this proposed statute.

 

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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 .

Coerced Prenuptial Agreement Set Aside

How many prenuptial agreements have language in them that the parties are entering into the agreement free from duress, coercion, undue influence, etc?  The answer is all of them.  Some even ask people to waive fraud - how you can do that I don't know because if you knew you were being defrauded, you probably wouldn't enter into the agreement.  How many times is the agreement presented at the last minute, after the bride to be's parents are out tens of thousands of dollars for the wedding?  How many times does the person presenting the agreement say "Don't worry about it, it doesn't mean anything", "don't worry about it, I'll give you more" or "don't worry about it, I'll rip it up in 5 years or after we have kids, etc?" 

This probably happens all to often or at least, more often then we want to believe.  In most cases, since you have said you have entered into the agreement free from duress, etc., you will have a hard time getting out of the agreement at the time of divorce.

But alas, comes the Petraikis case out of New York discussed in yesterday's New York Post.  In this case, Elizabeth argued that Peter coerced her signature, threatening to call off the wedding even though her father had already paid $40,000 for the reception.  She also claimed that he told her that he would rip up the agreement as soon as they had children.  The trial court set aside the prenup on the basis that Peter fraudulently induced Elizabeth to sign it.  The Appellate Court upheld this decision.

In New York, prenups are usually particularly hard to overturn so many deem this to be a landmark decision.  The take away here is that despite the recitations in the agreement, the door is open to try to prove contrary behavior and/or that there were additional promises outside of the agreement.  One wonders whether a video taped signing with the usual questions that the agreement was voluntarily being entered into would have saved the agreement.  That said, for the proponent of the agreement, you need to be really careful about what you say to induce the other side to sign an agreement and what pressure is put on to get an agreement signed.

 

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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.

 

No One Ever Just Says That Their Client Changed Their Mind

I sit here stewing on this overcast Friday because the other side reneged on the settlement in two matters, after we believed we were all but resolved in both.  Whether or not these were enforceable settlements is a topic for another blog.  That said, one is particularly frustrating because the other side essentially undid a package proposed by them a few mediation sessions ago which been discussed at a few mediation sessions, only to come back with a new proposal that was accepted by my client. 

The problem is that no one ever just says "my client changed his/her mind."  This would be a fine answer especially in situations where we have laid the ground rule that there is no deal until it is signed of by everyone.  Rather than truth, we get hit with lame, absurd, and/or intellectually dishonest explanations as to why there never was a deal in the first place, and/or why the back tracking (a nice way to say bad faith negotiations) was justified.

What are some of the "dog ate my homework" excuses we have heard.

  • My client didn't really understand (Were you, the attorney not there?)"
  • the mediation session was chaotic and ended abruptly (note - no denial that there was a deal)
  • my client didn't believe that any agreements were reached that date (of course, the lawyer isn't saying that there were no agreements reached)
  • "Oh, is that what we agreed to"
  • My client never agreed to that
  • We may be close on the big stuff (how is that when we accepted your offer on the "big stuff")
  • My client was very emotional
  • My client was hungry
  • My client didn't take their medication or took too much medication

I am sure that my colleagues could add dozens more.  That said, if a non-binding settlement is reached, wouldn't it be just better to tell the truth - i.e. my client changed her mind - then create anger and bad feelings spewing nonsense to cover for the acceptable truth?  I'm just sayin ...

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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

Parental Alienation Syndrome Will Not Be Included In the DSM 5

Back in 2009, we blogged about the possible inclusion of Parental Alienation Syndrome in the long awaited next version of the Diagnostic and Statistical Manual of Mental Disorders (DSM)

In that post, I discussed a US News and World Report article that addressed a movement afoot to add "parental alienation" to the next addition of the DSM (ie. Diagnostic and Statistical Manual of Mental Disorders) published by the American Psychiatric Association.

However, as expected for some time, the American Psychiatric Association board of trustees has recently approved the DSM 5 which has will be released in May 2013 and it has been confirmed that Parental Alienation Syndrome will not be included in the DSM V.

I am sure that this is both a defeat to some and a happy time for others. As I noted back then, while there appears to be little debate on whether parental alienation in both subtle and not so subtle forms goes on, there is a debate as to whether it represents a mental illness. On top of that, there is concern that certain opposition to visiting with a parent could either be age appropriate (eg. a teenager being oppositional) or otherwise justified.

No matter where you stand on the debate as to whether parental alienation is a mental illness, it is clear that alienating behavior in whatever form, big or small, cannot be good for the children that are exposed to it.  That said, because it will not be in the DSM, the debate over the issue shall rage on.  Moreover, without a diagnostic code, it will be difficult to get insurance companies, where coverage for mental health issues is often challenging, to pay for treatment related to parental alienation.
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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.

Read Aaron Weem's Interesting Post Entitled "Emotional Abuse Just As Harmful as Physical Abuse"

Aaron Weems is an attorney in our Blue Bell (Montgomery County), Pennsylvania office and editor of the firm's Pennsylvania Family Law Blog wrote an excellent post entitled "Emotional Abuse Just as Harmful as Physical Abuse."

While some of the local programs Aaron discusses for his county may not be available in New Jersey, the piece provides a good explanation of the issues and I encourage you to read it.

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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.

Another Reason to Settle - Parties can agree to things that Judge's can't mandate - like automatic reductions and formulas for alimony

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.

Interestingly, as to the automatic reduction of alimony, the Appellate Division noted that:

Paragraph 21 of the AJOD provides for a pro-rata reduction in alimony payments if defendant's annual gross earnings drop below $2,800,000 in a given year. In addition, paragraph 8 provides that defendant "will have an automatic right to receive a reduction in Alimony" if his gross annual earnings fall below $2 million. The parties did not agree to an automatic adjustment in alimony based upon this criterion. Each of the parties argues that the court erred in including this provision in the AJOD and that any  modification of alimony should be subject to the principles set forth in Lepis v. Lepis, 83 N.J. 139 (1980). We agree. Therefore, we reverse that part of the court's decision set forth in Paragraphs 8 and 21 of the AJOD that calls for an automatic reduction in alimony based upon predetermined income amounts, and direct that it be vacated from the order. (Emphasis added)

As highlighted above and in this quote, the parties could have agreed to such an automatic review in advance.  In fact, it happens reasonably often.  A judge cannot because it would, in essence, be a pre-judgment of what happens when there is a future event. A court, for example, cannot say at the time of the divorce that alimony will terminate upon the payor's retirement at age 65.  Parties can (but rarely do) agree to that.  At trial, judge's also cannot say that the support will increase if the payor's income goes up.  They cannot say that the support will go down if the recipient earns $X dollars.  On the other hand, parties agree to this all of the time.  It is rare to see courts impose different tiers of alimony (eg.  $50,000 a year for the first 3 years dropping down to $35,000 for the next two years dropping down to $20,000 thereafter, for example).  Parties do this all of the time too.

The bottom line is that one size does not fit all.  Unfortunately, trial judges are limited in their abilities to creatively decide cases.  So if you want the resolution that best meets your needs, settle.

 

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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.

How to Not Settle Your Case

Having just experienced several months of "interesting", to say the least, negotiations on several matters, it got me thinking about creating a list of things to do if you really don't want to settle your case.  Hey, every body is entitled to their day in court if they want it. So what if there is nothing that can be gained from it.  So what if you can't win.  So what if forcing the matter to trial will create other legal issues.  So what if trial will cost tens of thousand of dollars.  Here is the list:

10.  Ignore your expert's advice.  What do they really know about the value of your business or how a judge will likely assess your total income/cash flow?  What does an accountant know about taxes, or more importantly, how the IRS may address the creative accounting practices that you or your business have employed?  What does the custody expert really know? 

9.  Ignore your lawyer's advice.  What do they know anyway?  If your lawyer is telling you that you should jump at the deal on the table because it looks like a huge win, disregard it.  If they tell you that you have real exposure on certain issues or may be forced to pay your spouses legal fees, roll the dice. If your attorney tells you that they are willing to try your case, but that you should consider settlement because the cost of the settlement will be less than the cost of the trial plus the absolute minimum you have to pay, don't believe it.  And what does your lawyer know about the law or the judge anyway?

8.  Ignore the facts of your case.  Trust your ability to spin the facts in a way that doesn't make sense.  Plus, how can they prove if you're lying.

7.   Ignore what the neutrals are saying.  What do the Early Settlement Panelists know?  What does the mediator know?  When the judge has a settlement conference and gives directions, what does she/he know?  Assume that the people that have no "horse in the race" are aligned with your spouse or their attorney, have been bought off, or are just plain ignorant.  Really, it has nothing to do with the facts of your case or the reasonableness of your position.

6.  Ignore the law.  It doesn't apply to you anyway.

5.  Continue to misrepresent things, even when the other side has documents to disprove virtually everything you are saying.  Assume that you will be deemed more credible than the documents.

4.   Believe that the imbalance of power that existed during the marriage will allow you to bully your spouse into an unfair settlement.  Assume that your spouse's attorney wont try protect her/him.  All lawyers roll over on their clients, right?

3.   Take the position that you would rather pay your lawyer than your spouse. Ignore that fact that this tactic usually ends with your doing both, and maybe your spouse's lawyer too.

2.  Pretend as if your spouse never spent a second with the kids in the past and has no right to do so in the future.  Make false allegations of neglect or abuse.  Ignore the social science research that says that it is typically in the children's best interests to spend as much time as possible with each parent.  What do the experts know about your kids anyway?  And while you are at it, bad mouth your spouse to or in front of the kids. Better yet, alienate them.  Then fight attempts to fix the relationship.

1.   Take totally unreasonable positions implementing any or all of above and on top of that, negotiate backwards.  Ignore the maxim "Pigs get fat, hogs get slaughtered."  Put deals on the table and then reduce what you are offering.  Negotiate in bad faith.  Negotiate backwards.  Don't worry that this conduct may set your case back.

The above is clearly facetious and tongue in cheek. I do not recommend this behavior.  It is usually self destructive and short sighted.  But, believe it or not, these things happen all of the time.  While I am not saying that no case should ever be tried, because sometimes trials are necessary, if you want to ensure a costly trial that may not go well for you, try the things on this list.  And if it is your day in court that you want, be careful you wish for.

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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.

Everything You Say Can and Will Be Used Against You in a Court of Law - Especially if you said something different in another court

We have all seen and heard those familiar words in the title of this entry in moves or on TV.  This is part of the "Miranda" warning administered by a police officer when they are arresting someone.  Do these words also have a place in divorce court?  Not in the same way, but in reality they do.

Other than settlement communications, attorney/client and other privileged communications, everything else is just about fair game.  That is why Facebook, emails and texts have become such a treasure trove in divorce cases as people freely put things in writing that they might not otherwise say, and perhaps even broadcast it to the world.

But what about what you say in another court in another case?  Can that be used against you?  Sure can.  The concept is called judicial estoppel, and it was on display again yesterday in the unreported (non-precedential) decision from the Appellate Division in Romano v. Romano.

Without getting in to all of the details of this case, the relevant details relating to judicial estoppel are as follows,  On the wife's name was on the deed of the marital home, a finding made by a judge during a domestic violence trial, despite the husband claiming he was on the deed.  Thereafter, the husband filed for bankruptcy relief.  In that filing, he answered "none" on the part of petition asking if he had a legal or equitable interest in any real property.  In the later divorce case, he listed the aforementioned home as a marital home subject to equitable distribution. 

The trial judge awarded the home to the wife based on the husband's representation to the bankruptcy court that he had no interest in the property.

The Appellate Division affirmed, noting:

Judicial estoppel is intended to protect the integrity of the judicial process. Cummings v. Bahr, 295 N.J. Super. 374, 387 (App. Div. 1996) (citing Edwards v. Aetna Life Ins. Co., 690 F.2d 595, 599 (6th Cir. 1982)). It "operates to 'bar a party to
a legal proceeding from arguing a position inconsistent with one previously asserted.'" Id. at 385 (quoting N.M. v. J.G., 255 N.J. Super. 423, 429 (App. Div. 1992)). The doctrine "prevents litigants from 'playing fast and loose' with, or otherwise manipulating, the judicial process." State v. Jenkins, 178 N.J. 347, 359 (2004) (quoting N.J. Dep't. of Law & Pub. Safety v. Gonzalez, 142 N.J. 618, 632 (1995)). "Central to that concern is the principle that a litigant should not be allowed to
mislead courts by having one tribunal rely on his or her initial position while a subsequent body is led in a different direction." Ibid.

The applicability of judicial estoppel as a complete bar to a subsequent inconsistent claim arises "when a party advocates a position contrary to a position it successfully asserted in the same or a prior proceeding." Ali v. Rutgers, 166 N.J. 280, 287
(2000) (internal citations and quotations omitted). A prior successful assertion of a contrary position is required because "[a] party is not bound to a position it unsuccessfully maintained" in a prior lawsuit. Id. at 288 (internal citations and quotations omitted). As with most judicially crafted remedies, judicial estoppel should be invoked only to prevent a miscarriage of justice. Ibid.

Here, John's conduct provides almost a textbook example of facts calling for the application of judicial estoppel. By his own admission, John advanced inconsistent positions regarding his interest in the marital home. John failed to disclose his
alleged interest in the home in the petition he filed under oath before the federal bankruptcy court.   In addition, John filed an amendment to his bankruptcy petition in September 2010, but did not alter this critical detail. A bankruptcy plan was subsequently approved based on John's financial representations.

John's testimony that his bankruptcy lawyer advised him to deny any ownership interest in the marital home does not absolve him of responsibility for his  certification. John did not call his bankruptcy attorney to testify as support for his assertion. Certainly, a witness should not be permitted to hide behind the
unsubstantiated excuse that his lawyer told him to lie on a sworn document.
John's assertions in support of this action before Judge Becker are materially irreconcilable with the position he adopted before the federal bankruptcy court. The judge did not abuse his discretion in finding that John was attempting to manipulate the legal system to his advantage and to the disadvantage of his creditors and Dana. The application of judicial estoppel is warranted under such circumstances.

The bottom line is that you cannot select a different story to get the best result based upon the audience at the time. When you do, whatever you say can and will be used against you in the next proceeding, as the husband found out in this case.

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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.

Appellate Court Approves the Use of "Rule of Thumb" Formula to Calculate Alimony - Sort Of

In August 2011, I posted an article on this blog entitled "Appellate Court Rejects 'Rule of Thumb' Formula to Calculate Alimony - Sort Of."  In that article, I noted that there was a dirty little secret used by judges and lawyers in New Jersey to come up with a "ball park" as to what alimony should be. This "rule of thumb" does not take into account all of the statutory factors. Rather, the formula simply subtracts the lower income (real or imputed) from the and multiplies the difference by a percentage. I have been told that that percentage is 30% or one-third in the northern part of the state and 25% in the southern part.

More importantly, I noted that judges really cannot use this formula and must make findings considering the law and all of the statutory factors.  This post was as a result of a case where the judge seemingly used the formula to determine alimony.  The Appellate Division remanded the matter to the trial court to determine alimony using the alimony factors.

So much to my surprise, a new case came out yesterday emanating from a legal malpractice case filed by a litigant against her divorce attorney.  Lo and behold, the Appellate Division notes that using this "rule of thumb is an appropriate way to calculate alimony. 

In the underlying divorce case, which was noted as contentious, the parties were married for 22 years. They had two children.  The husband's (who was a lawyer) average income over the 3 preceding years was $246,000.  The wife's earning history was $42,000 per year.  Under most factors in the alimony calculus, this should have been a permanent alimony case - except the husband apparently did not want to pay permanent alimony and long and acrimonious negotiations ensued.  Without getting in to specifics, it is alleged that the wife was ultimately pressured by her attorney into accepting less alimony than she might have received and limited duration alimony.  She alleged that she received inadequate consideration for waiving permanent alimony under the circumstances.  As a result, she filed a legal malpractice action.

Her expert in the malpractice action issued a report, in which she cited the rule of thumb as a means to calculate alimony to show that the amount was insufficient. The wife's divorce attorney moved for summary judgment saying that this was a net opinion.  An expert's opinion must be based upon facts or data and cannot be speculative. Moreover, the opinion must be based upon generally accepted objective standards of practice. The divorce lawyer's motion was granted by the trial court and the case dismissed.  The Appellate Division reversed this finding. 

Of note, the rule of thumb was embraced:

Consequently, the expert opined that the accepted standard of care required Grayson to recognize that plaintiff would be entitled to permanent alimony and to act accordingly. So
measured, the expert concluded that the settlement in this case was substantially below the range of award she most likely would have received at trial because plaintiff waived her entitlement to permanent alimony in exchange for a lump sum $50,000 payment;
gave up her right to receive an award of counsel fees for no apparent consideration; and abandoned her option to retain the marital home worth $720,000 for only her rightful one-half share of the equity therein.

The expert laid the foundation for this conclusion, detailing step-by-step the methodology she employed. Before quantifying the amount of anticipated alimony to be awarded at
trial, the expert correctly recognized — citing Crews v. Crews, 164 N.J. 11 (2000), and Lepis v. Lepis, 83 N.J. 139 (1980) — that the purpose of alimony is to allow the dependent spouse to enjoy the standard of living she had during the marriage and
that the other spouse should pay alimony in that amount, if he is able to. The expert then estimated the range of yearly permanent alimony to be between $65,000 and $72,000 based on each party's historical earnings and utilization of a formula widely accepted amongst members of the matrimonial bar.

As to the former, the expert used the average of the husband's income over several years to account for spikes and dips in his solo law practice, and arrived at a range of between $200,000 and $250,000 annually. Plaintiff, on the other hand, after returning to work in 1999, averaged about $42,000 per year. The expert then derived a yearly alimony figure by taking one-third of the difference between the spouses' incomes. In doing so, the expert relied on a generally accepted objective standard of matrimonial attorney practice and not simply a standard personal to her. See Fernandez v. Baruch, 52 N.J. 127, 131 (1968). She also opined, based on her experience, that the ultimate alimony award would be in the higher estimated range because the weight of statutory factors — the couple's age, established standard of living, and large disparity in income and earning capacity — heavily favored plaintiff and therefore justified the upward adjustment.

In determining that the expert's opinion was not a net opinion, the account accepted that the expert employed "a generally accepted professional standard" to calculate alimony. While the court noted that the expert's report was not beyond attack at trial, the plaintiff had a right to have the jury determine the credibility and weight of the evidence.

So the take away from this case is that the rule of thumb likely exists as a valid tool to estimate alimony.  However, if there are special circumstances, the factors still have to be considered.  Whether judges can use it remains unclear but is probably unlikely. 

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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.

The Anti-Climactic End of the Tannen Saga - The Supreme Court Weighs In, Sort Of

A little more than a year ago, we blogged on the reported Appellate Division Case, Tannen v. Tannen, which addressed the issue of trusts in the context of family law cases.  Relatedly, we blogged on the impact of income from a discretionary trust and whether it reduced a party's need.

In Tannen, the trial court, relying on the newest version of the Restatement of Trusts, required the trustee of a discretionary trust to make distributions to the beneficiary of the trust. Though the trust assets earned significant income, there was no requirement in the trust document for the distribution of the income to the beneficiary. 

The Appellate Division reversed, holding that by applying existing law, which has incorporated various provisions of the Restatement (Second) of Trusts, Wendy’s beneficial interest in the Wendy Tannen Trust was not an “asset held by” her for purposes of N.J.S.A. 2A:34-23(b)(11) of the alimony statute. As  such, the panel determined that no income from the Wendy Tannen Trust should have been imputed to Wendy in determining Mark’s alimony obligation. Addressing the trial court's reliance on the newest Restatement, the Appellate Division noted:

[a]s a court of intermediate appellate jurisdiction, we do not presume to adopt the Restatement . . . as the law of this state and apply its provisions to the facts of this case. Given the significance of its principles in the context of [the New Jersey statute dealing with the power of a court to impute income to a party in a divorce action), such determination would be more appropriately made by our Supreme Court.

As a result, as practitioners, we all awaited the Supreme Court's decision on this expecting that they would tell us one way or the other whether trial court's rationale would become the law of this state.  Doing so might have weakened the sanctity of trusts, but might have been consistent with the jurisprudence of this State that is typically deferential to and supportive of the support recipient for public policy reasons. 

The Supreme Court decided - drum roll please - :The judgment of the Appellate Division is affirmed,
substantially for the reasons expressed in Judge Messano’s opinion of the Appellate Division reported at 416 N.J. Super.248 (2010)."  This one sentence opinion is an anticlimactic end to what could have been a very interesting discussion of an important legal issue.  Because Judge Messano deferred to the Supreme Court on a policy issue, as a student of the law, it would have been interesting to hear our high court explain their rationale given the limitations that the Appellate Division expressed in their opinion.

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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 is resident 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.

 



 

In a Long Term Marriage, Length of Marriage May Trump Age in the Alimony Calculus

Right before the Thanksgiving holiday the NJ Appellate Court came out with an unpublished decision yet again reminding trial courts when permanent alimony should be permanent and not something else.  While there is no bright line, black and white rule written about the magic number of years that would entitle a spouse to permanent alimony, there are certainly some general facts that assist attorneys and judges alike in determining when a case is appropriate for permanent alimony.  This decision reminds us of those.

In the matter of Happold v. Happold, A-2792-10T1, decided November 21, 2011, the Appellate Court reversed and remanded (to a new judge in the trial court) a decision, which awarded the Wife 10 years of limited duration alimony instead of permanent alimony.  The relevant facts are as follows:

1. The parties were married for 21 years at the time the Complaint for Divorce was filed.

2. The parties were ages 42 and 43 at the time of the Complaint.

3. Three children were born of the marriage, one was emancipated before the trial.

4. The Wife became pregnant with the parties' first child at the age of 16, when she was in the 10th grade.  Husband was in 11th grade at the time.  Wife dropped out of high school only completing a 9th grade level of education.  Husband continued in school and graduated.

5. One year after their first child's birth, Wife moved into Husband's parents' home with Husband.  Wife never worked outside the home during this time.  Husband completed high school and began working.

6. The parties' two other children were born in 1993 and 1995.  While Husband worked outside the home and his career continually advanced, Wife remained at home as the sole caretaker for the children and the home.

7. During the marriage, Husband controlled the parties' finances except for a jointly held savings account intended to give Wife immediate access to money if Husband died.

8. At the time of the trial and during the last year of the marriage, Husband's income was $238,500 and $215,000 respectively.

Wife testified that during the marriage, Husband prohibited her from working and being involved in the finances claiming she was "too stupid to handle the bills".  While their lifestyle expenses differed on their Case Information Statements, Wife testified that she was unaware of what and how much their expenses were because Husband controlled these items. 

After trial, the court rendered a decision on the validity of a prenuptial agreement, Wife's request for alimony, and Wife's request for counsel fees.

The court held the prenuptial agreement was unenforceable. This ruling remains unchanged.

The Court reversed the award of ten years of limited duration alimony stating it "ignores well settled precedent that absent exceptional circumstances not present here, permanent alimony is appropriate in the case of a long-term marriage like that of the parties."  In it's opinion, the Court supported this decision by holding that the Wife's economic dependency on the Husband pre-existed the marriage by 5 years.  Also, the lower court's findings on the statutory factors, which guide courts in awarding the type and length of alimony "was conclusory and cursory".  The Court went on to add a footnote specifically addressing that high school drop-outs, especially those beyond their mid-twenties, face the highest rate of unemployment in our society.

In its lengthy critique of the trial court's decision, the Appellate Court also noted that the lower court failed to give adequate recognition to the Wife's "extreme dependence" on the Husband.  The relatively young age of the parties at the time of trial did not outweigh the duration of the marriage and other relevant factors, which support an award of permanent alimony in this case.

Lastly, the Appellate Court vacated the trial court's decision to award the Wife only $5,000 in additional counsel fees based upon a finding that the Wife "maintained unreasonable positions at trial and declined to settle the case along lines similar to the court's ultimate judgment".  The Court held that the trial court deviated from Rule 5:3-5 and failed to address the specific factors outlined therein.  More importantly, the award was reversed because of the trial court's "mistaken rejection of [the Wife's] permanent alimony claim tainted its assessment of "the reasonableness and good faith of the positions advanced by the parties," and the "results obtained"." 

Lesson learned: Limited duration alimony was not appropriate in a case with these facts.  Assess your situation in light of all the statutory factors and the precedent set by the relevant case law.  At least in this case, the other lesson is that the length of economic dependency trumped the relatively young ages of the parties at the time of the divorce.

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Sandra Fava is a contributor to the New Jersey Family Legal Blog and a member of Fox Rothschild's Family Law Practice Group. Sandra practices throughout New Jersey in all areas of family law and family law litigation. You can reach Sandra at (973)994-7564, or sfava@foxrothschild.com.

What Happens When the Judge Ignores Trial Stipulations

Trials in divorce matters are kind of like the Loch Ness monster - lots of people of heard of it, but few have actually seen it.  The system is currently set up such that there are many vehicles to get people to a settlement.  Moreover, most cases should be settled.  In fact, as I have blogged in the past, the cases that often get tried are ones where one, if not both parties, are totally unreasonable and unrealistic. As noted in prior blogs,there are, however, bona fide cases that cannot be settled and must be tried.

Many judges have a pre-trial Order or letter citing requirements of things that must be done before trial.  One of the things often on the list is that counsel are supposed to confer to to see if the can reach any stipulations as to facts, and sometimes legal issues.  Court's have noted that "stipulations serve as a tool that enables parties to avoid the expense, trouble, and delay of adducing proofs on facts that, absent a stipulation, are contestable."  Though I have one colleague that refuses to enter in to stipulations because he feels that it throws off the flow or leaves holes in his presentation, generally, stipulations are a good thing because it cuts down on what is already limited trial time. 

Courts often also require parties to confer about joint exhibits for the same reason.  Once the parties agree, the exhibits are marked and should go into evidence without the need for authentication of other testimony.  Examples of things that are commonly joint exhibits are tax returns, bank records, prior court orders and transcripts, credit card records, and the like. 

The question then is, does a trial court have to accept the stipulation, and if they don't, what is supposed to happen.
 

This issue came up this week in the unreported (non-precedential) case of Hertzoff v. Hertzoff.  In that case, the parties entered in to a number of stipulations which the trial judge ignored, especially as it related to equitable distribution. 

Getting back to the questions asked above - a trial judge does not have to accept the parties' stipulation.  In this case, the Court noted that the law is as follows:

As a general rule, "litigants should be held to their stipulations and the consequences thereof." Ibid. Nonetheless, a trial court has the authority to override a stipulation in certain circumstances:

 [I]n the rare instances in which the circumstances . . . justify the court's              rejection of the parties' stipulation, the party losing the benefit of  the stipulation
must still receive his day in court with respect to the stipulated issue. This
requires that the litigant who is being prejudiced by the court's non-adherence to
the stipulation be given the same opportunity to present his proofs as he
would have received had the stipulation not been entered on the record.

So, while the court is free to reject the stipulation, the judge must let the parties know and give them an opportunity to adduce proofs regarding the issue(s) for which the stipulation(s) was rejected.  Failure to do so may result in a reversal and a new trial.

Biological Parents Have Presumption of Custody Vs. Third Parties

Yesterday, I blogged about the constitutional protections given to parents when in a custody dispute with a grandparent, including whether a psychological parent receives the same protections that a biological parent receives in such disputes (the answer is no - but you knew that because you read yesterday's post.)

A related topic is what is the standard to apply when a biological parent is in a custody dispute with a third party.  On the same day that the Appellate Division decided the case I blogged about yesterday, they also decided the case of Schwear v. Prigge and Schwear though that case is unreported (non-precedential). This case involved a custody dispute between a natural mother and her child's paternal uncle.  I will spare you the tortured history of the case and focus on what the law is. 

Custody disputes between a natural parent and a third party are governed by Watkins v. Nelson, 163 N.J. 235 (2000).  As the Court in Schwear noted:

In such a dispute, there is a presumption in favor of the natural parent which arises from a parent's "fundamental liberty interest protected by the Due Process Clause of the Fourteenth Amendment to the United States Constitution" and is "rooted in the right to privacy." ... The parent's right to custody is not absolute, however.The presumption in favor of the parent will be overcome by "a showing of gross misconduct, unfitness, neglect, or 'exceptional circumstances' affecting the welfare of the child[.]" 

When a third party seeks custody, the court must engage in a two-step analysis. First, the court must determine whether the presumption in favor of the legal parent is overcome by either a showing of "unfitness" or "exceptional circumstances."
If either is satisfied, the court must then decide whether awarding custody to the third party would promote the best interests of the child. (Citations omitted).

The rights of a parent have constitutional implications.  As such, whenever they might be abridged, there is a heightened scrutiny that much be applied.

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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.

If a Tree Falls During Mediation, Can the Mediator Tell Anyone About It?

Last week, Larry Cutler posted a piece on this blog entitled "Are Mediation Proceedings Really Sacred and Secret?"  The inspiration for this post was a recent published Appellate Division case Willingboro Mall, Ltd. V. 240/242 Franklin Avenue, L.L.C.., a case in which a mediator actually filed a certification and testified.  That, however, is the exception but not the rule. 

Often enough, parties go through mediation and believe that they have reached agreement.  It happens in divorce cases, and as evidenced in Willingboro Mall, it happens in other litigations.  Can the mediator testify that (1) there was a settlement and (2) what the terms are?  R. 1:40-4(c) includes a  restriction that "[no] mediator may participate in any subsequent hearing of the mediated matter or appear as a witness . . . for any person in the same or related matter.." The reported case of Lehr v. Afflito reiterates that the involvement of the mediator is improper absent a valid waiver by both parties.

Should this be the case, however?  If the ultimate issue as to whether or not a matter was settled is in dispute, who better than the mediator to answer that limited question?  If the parties agree ta ht the matter was settled but disagree on what the terms were, who better to answer that question too?  Parenthetically, if you go on the New Jersey Judiciary Web Site, there is a form for use by a mediator which is to be submitted to the Court after mediation called the Mediation Case Information Form.  The form requires the mediator to advise the matter is fully settled, partially settled or not settled.  Seemingly, this form would not be evidential under Lehr.

Since the Court places such high importance on the settlement of a matter on a public policy basis, would requiring mediators to report these things, if there was a dispute, really up end the confidentiality of the process.  Doesn't settlement signal the end of the process? Interestingly, in Willingboro Mall, Judge Fall (a former Family Part Judge), noted the following in response to the plaintiff's position that for a matter to be settled during mediation, there must be a contemporaneous writing on the spot:

Plaintiff's position also ignores the reason for referring a matter to mediation. The process is utilized to afford the parties an opportunity to present their position before an experienced professional with the goal of resolving some or all of the differences between the parties. See State v. Williams, 184 N.J. 432, 441 (2005). In contrast to arbitration, the mediation process is non-binding only in the sense that the process is not designed or intended to impose a result on any party. Indeed, such a result is the antithesis of the mediation process. Mediation is also not intended or designed as a meaningless and impotent detour on the way to judgment. The very purpose of the process is to resolve the dispute. (Emphasis added).

People can always make one of the ground rules of mediation or a settlement conference that there is no settlement until it is reduced to a writing signed by all parties.  That said, if they don't do that and then settle at mediation, should a party be allowed to renege, or even claim that there was no deal without the one person, without a vested interest in the litigation, telling the Court about the settlement?  As ADR is becoming more prevalent, my guess is that we have not seen the last of this issue.

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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.

ISRAELI COURT FINES WOMAN FOR REFUSING TO DIVORCE HUSBAND

Recently I blogged on the difficulties experienced by some spouses left with no choice but to abide by New Jersey's "no fault" divorce process.  Looking at the husband in "Crazy, Stupid, Love", and discussing how, if the story there took place in New Jersey, he would have to get divorced simply because his wife wanted to.  Now from the Israeli newspaper "Haaretz" comes the story of a woman who was fined 200,000 shekels (approximately $56,000) by an Israeli court for refusing to divorce her husband, even after she was directed to do so by a Rabbinical court.  

Interesting was the Israeli court's rationale for the fine, deeming it to be sufficient compensation for the wife violating the husband's autonomy.  Also interesting was the wife's rationale for refusing the divorce.  While the husband proved to the court that his wife was infertile and, as a result, should be compelled to divorce him, the wife refused to grant the divorce or participate in the process because she believed that her husband (from whom she had separated years earlier) was simply interested in another woman.  Showing just how stern the court was with its ruling, it held that the fine would stand even if the parties subsequently divorced by agreement, and that the wife could be subject to future fines if she continued in her non-compliance.

Obviously this situation would not occur in New Jersey with its no-fault divorce option.  Further, although not an issue here since it was the husband who sought the divorce, it is worth noting the complexity and nuance involved with procuring a Jewish divorce.  Under Jewish law, a "Get" is a bill of divorce that a husband gives to a wife in order to "free her" to remarry.  A secular divorce will not do the trick, as the couple's marital status will remain unchanged under Jewish tenet.  We have blogged on this topic previously.  Notably, in the United States, a wife may seek relief from a civil court for an Order directing the husband to grant the Get, such as via an action for specific performance since there really is not sufficient legal remedy to redress the wife's injury including, among other things, her inability to remarry in the eyes of Jewish law.  In the eyes of the New Jersey judiciary, compelling a husband to obtain a Get provides is for a secular purpose - the end of the marriage.

While such a situation is different from that described herein, both situations reflect the broad cultural and religious spectrum that underlies the divorce process domestically and abroad.    

Husband's Sweat Equity Awards Him Greater Share of Marital Real Estate - Is a Slippery Slope Afoot?

In cases where a party owns a business, as justification for a disproportionate split of the business in equitable distribution, we often hear that the titled spouse has to be rewarded for their effort, ingenuity, ideas, etc. related to the business.  While arguably those things could be part of the analysis of the statutory factors, there really is not any law suggesting that this must be so.  In fact, the real justification that I can really get my arms around as to why a business would be disproportionately distributed is the fact that it is often pregnant with capital gains.  While the law is pretty clear that we cannot reduce the value because of hypothetical tax consequences, we can certainly look to same in the percentage distribution.  This makes sense because the failure to do so may actually give the non-titled spouse a greater percentage if taxes are ignored.

That said, I have heard this "sweat equity" argument over the years but have rarely seen a case where it was articulated.  That is until today when the Appellate Division released the unreported (non-precedential) opinion in Falkowski v. Falkowski.

In this case, the husband renovated two homes., purportedly without the assistance of the wife. The first was a premarital home which he renovated during the marriage.  The second, renovated after the parties' child was born and she left the workforce, was purportedly done on his days off (he worked full time as well.)  For the first house, the husband's "sweat equity" garnered him an additional 5% of the equity in the asset.  For the second home, the husband received 65% and the wife 35%.  In so ruling, the judge said:

[Husband] worked for five years to build that house into what it is, I gather, today. The testimony was pretty clear. Aside from the fact that [wife] had no say in it, and [husband] did all this with his friends, over five years he gutted everything to the frame. And he replaced everything. And he was fairly passionate when he testified about it too, all the work he did.

. . . . [I]t was a monumental amount of work. I was impressed with the fact that he
basically took the house down to its bare frame and bare rafters and built the entire
thing over. For those reasons I am not splitting this asset equally either. I
believe it's fairer to recognize that sweat equity and give him 65% of the net value and give [wife] 35% of the net value.

Noting that New Jersey is an equitable not an equal distribution state (i.e. a community property state), the Appellate Division upheld the ruling.  At the end of the day, the wife got $73,000 less than the husband. 

The question is can the analysis here be applied to other assets and other situations.  What if instead of working and spending all of his free time on renovating the property, the husband spent 90 hours a week to build a business while, as here, the wife was home with the child(ren)?  Is he rewarded for his sweat equity?  Should the wife get more alimony and child support in that case because she spent most of the time with the children?  Maybe - maybe not.

What if, the parties need a similar type of renovation to both their residence and shore home, but instead of the husband doing all of the work (with the assistance of his friends), he entrusts the job to the wife who serves as the general contractor, arranging for and dealing with all of the subcontractors, picking out and purchasing all of the appliances, floors, wall coverings, furniture, furnishings, etc. and dealing with the entire project without any assistance from the husband other than his income to pay?  At the same time, she is also primarily responsible for the children.  Does the same court award her a greater share of those homes?  I wonder. 

I have often said that though New Jersey is not a community property state, you often would not know it based upon how assets other than businesses are divided.  If "sweat equity" and other statutory factors are going to be applied, I am all for it.  Someone just better tell everyone in the system that that is what we are doing.  Too often, people default to equal distribution and "rules of thumb" for support ignoring statutory factors and equitable principles.  When someone argues against the norm, they may be accused of being litigious or unreasonable.  Why is this so?  I posit that it should not be.

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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.

Three Matrimonial Appeals Decided Today - Three Reversals

The New Jersey Judiciary website provides each days published and unpublished Appellate Division decisions.  If you read this blog with any frequency, you know that we often write about the decisions that are released.  Today there were three decisions from post-judgment divorce cases.  We will likely blog in more detail about some or all of them in the future.  What is interesting is that despite the fact that historically, appeals succeed only approximately 20% of the time, there were reversals in all three cases. 

In one, alimony was modified and permanent alimony was awarded without the court holding a plenary hearing (i.e. trial) on the contested issues. 

In another, the trial judge modified child support, multiplying the old child support amount  by the percentage increase in the plaintiff's income.  The Appellate Division held that a simple mathematical calculation does not comply with the mandates of the statute and case law.  They further held that while the percentage increase is an important factor in determining the support obligation, it is not exclusive and does not relieve the trial judge of performing the required analysis
prescribed by the statute and case law.

In the third, there were conflicting certifications regarding a husband's application to reduce support and the wife's cross application for enforcement.  Not only was there no plenary hearing ordered despite conflicting certifications, there was not even oral argument on the motion allowed despite both parties requests for same.

What is the common theme in all of these cases.  The Appellate Division found that the trial court decided cases without doing all of the things that were necessary to decide the cases, most importantly, holding a hearing where there are contested facts. Trial judges are already over burdened so one can understand why they may want to cut to the chase.  While understandable, it is obviously not acceptable to the Appellate Division or the justice system in general.

Is the problem going to get worse.  There is already a shortage of judges.  In some cases, you are being told that you cannot get a trial date for years notwithstanding the "best practices" goal to resolve all cases in a year.  With the shortage of judges already and pending changes to the pension system which may cause sitting judges to retire and prevent good potential judges from wanting to become judges, one can see the problem getting worse and not better. While alternate dispute resolution like mediation and arbitration is an option to get more speedy justice and we use it all of the time, litigants are still entitled to have a free (relatively) and efficient justice system to resolve their disputes.  If dockets are over burdened already, will this become worse?

Domestic Violence: Bad Haircuts and an Unwanted Hug Can Constitute Harassment

This post was written by Melissa M. Ruvolo, a new Family Law associate, in our Roseland office, and soon to be an official contributior to this blog.

Our blog frequently features discussions regarding what constitutes domestic violence to warrant the issuance of a Final Restraining Order (FRO). Perhaps the most frequently alleged “predicate act of domestic violence” is harassment under N.J.S.A. 2C:33-4. What may constitute “harassment” was recently raised in the unpublished Appellate Division decision of A.B. v. L.S.M. decided on May 6, 2011.

The parties were unmarried but had been living together for almost four years. They had two daughters – a 3-year old and a 22-month old. During an argument, the defendant called the plaintiff a “b-tch” and the plaintiff admitted she may also have cursed and yelled at him. The defendant attempted to leave the home but while doing so, got a flat tire. When he tried to fix it with a car jack, the plaintiff twice tried to remove the jack from under the car and the defendant pushed her shoulders each time. She threw the daughter’s sippy cup at his face and broke his nose. Both parties applied for temporary restraining orders, which were dismissed. The defendant eventually moved out of the home and parenting time was ordered by the Court.

Two months later, the defendant went to the plaintiff’s home and knocked on her bathroom window, pleading to speak with her. The plaintiff refused. On the way home from plaintiff’s house, the defendant sent her an apologetic text message stating that he had no idea how much he had hurt her and would leave her alone.

Several days later, when the defendant went to the plaintiff’s home to pick up the children for parenting time, he asked to speak with her. He told her he “really missed her” and wanted to “hug and kiss her.” She responded that she didn’t want to talk to him or “have him touch her.” Later that evening, the defendant sent a text message to the plaintiff claiming the children forgot a teddy bear and blanket. She offered to bring them to his home and he agreed. When the plaintiff arrived at the defendant’s front door, he told her the children were already asleep, leading her to believe that the entire incident was a ploy to get her there. According to the plaintiff, the defendant grabbed her to prevent her from leaving and she told him not to touch her. The plaintiff’s friend, who was waiting in the car, witnessed the defendant give the plaintiff an unwanted “bear hug.”

On another occasion, the plaintiff went to pick up the children from the defendant’s home only to find that he cut the 3-year-old’s hair from halfway down her back to her shoulders and gave her bangs. He also cut the 22-month old’s hair “straight across the front and when it was wet it wasn’t straight.” The plaintiff was angry and thought this was done to harass her. The defendant claimed it was part of a “beauty makeover” and one of the daughters asked for a haircut.

Several days before obtaining the temporary restraining order, the plaintiff claimed that the defendant again cut an inch from only one side of the 3-year old’s hair. The defendant denied this. The plaintiff also stated that when she was leaving with the daughter, the defendant told the daughter he didn’t know when he would see her again because “mommy was being mean . . . and keeping her away from him.” He said this even though he had regular court-ordered parenting time with the children on a weekly basis.

The Appellate Division panel upheld the trial court’s decision that the defendant’s actions towards the plaintiff constituted harassment under N.J.S.A. 2C:33-4(c) because he engaged in a “course of alarming conduct or of repeatedly committed with purpose alarm or seriously annoy the [plaintiff].” The panel noted that the plaintiff repeatedly told the defendant she wanted to be left alone. Even so, the defendant called her a “mean mommy” in front of the children and gave the daughters “haircuts that, at best were amateurish, and at worst, ‘ruined’ their hair knowing that plaintiff would be upset.”

The defendant’s behavior, particularly in the presence of the children, was certainly inappropriate. However, did it truly warrant a FRO? A FRO carries serious consequences. The abuser cannot own a firearm and will be listed in the domestic violence registry, which is available to law enforcement agencies and Family Court domestic violence personnel. The violation of a FRO constitutes a criminal offense, which results in mandatory arrest and in some cases, jail time. In certain circumstances, one with an FRO can lose his/her job, especially those jobs that require the carrying of firearms or other weapons. One’s application for future employment or license certification could even be tarnished when the applicants responds “yes” to the question “have you ever been arrested?”

Perhaps the more appropriate result would have been to reconsider the defendant’s parenting time given his inappropriate actions in front of the children. On the other hand, maybe the court got it right and prevented the situation from escalating beyond control. Either way, this case teaches us that the broken-hearted must be conscious of the consequences of their untamed emotions.

APPELLATE DIVISION ANALYZES THEFT AS AN ACT OF DOMESTIC VIOLENCE

To obtain a Final Restraining Order, a claimant must, among other things, establish that one of the predicate act of domestic violence actually occurred under N.J.S.A. 2C:25-19.  Notably for the purpose of this blog entry, theft is not one of those predicate acts.  The question then begs - can theft be a form of domestic violence as a component of a claim that one of the actual listed predicate acts occurred?  As recently addressed by the Appellate Division in E.M.B. v. R.F.B., a new published (precedential) decision, the answer could be "yes."

In E.M.B., an elderly mother filed a domestic violence complaint against her 56-year old son, with whom she resided.  Mom claimed that Son had engaged in an act of domestic violence by stealing her car keys, cell phone, bank book, money and some jewelry from her bedroom.  Based on these factual details, and Mom's testimony, which the trial court found credible, a Final Restraining Order was issued based on a finding that Son harassed mom. 

In reversing the trial court, the Appellate Division broke its decision down into two parts.  First, it concluded that theft in itself is not a predicate act under the Prevention of Domestic Violence Act and, as a result, a Final Restraining Order could not be issued on a claim of theft alone.  The Appellate Division then went into a more detailed analysis as to whether the acts of theft could be classified as an act of harassment.

As to one comment made by Son that Mom was a "senile old bitch," the Appellate Division found that, upon a review of the context and surrounding circumstances, while the phrase was upsetting to Mom, there was no purpose to harass behind the statement and no violation under either subsections (a) or (c) of the harassment statute.  The Appellate Division made a brief, yet interesting commentary on the constitutional implications of restricting speech in the context of the harassment statute, noting that because the First Amendment "permits regulation of conduct, not mere expression[,]" the speech must have a "specific intention [of] harassing the listener."  Mere expressions of opinion uttered through the use of offensive language is not enough to establish harassment.

As to the acts of theft, even if they could be considered a course of conduct, the Appellate Division concluded that there was a lack of proof that Son was motivated by a purpose "to alarm or seriously annoy" as required by subsection (c).  To that end, the Appellate Division found no evidence that the theft was anything more than the son taking Mom's property for his own use.  As to the prior history of domestic violence aiding the court in finding the occurrence of a predicate act of harassment, the Court concluded that prior incidents of theft could not be relied upon without proof that the thefts occurred with a purpose to harass Mom.  As a result, the Final Restraining Order was reversed.

While we have blogged about the somewhat difficult requirement of proving a "purpose to harass" in the past, E.M.B. is interesting in its constitutional analysis and review of the harassment statute in the context of theft.

If You Think that Your Job Related Life Insurance Is Enough, Think Again

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. 

Upon learning that the husband had not converted his policy, the wife filed a motion to compel the husband to obtain the required life insurance.  The husband opposed it claiming that the life insurance set forth in the Agreement was no longer available to him and the plain language of the agreement  "...did not require him to obtain an "individual or non-employment group life insurance policy" for the benefit of plaintiff." 

Both the trial court and Appellate Division disagreed with the husband's position holding that the
clear purpose of the life insurance provision in the JOD was to secure defendant's alimony payments. The court also found that defendant had a continuing obligation to secure his alimony obligation.

The Appellate Division also cited the statute creating the justification for the security.  The Court also noted that the purpose of life insurance is to assure a sufficient fund for the payor's support obligation should he die before fulfilling that responsibility. Further, the function of alimony can be maintained after the obligor's death by substituting insurance proceeds.

The lesson to take from this case is that if work related life insurance , which may be provided at little to no cost to the employee, is going to be the insurance used in the Agreement, the parties should specify what should happen if this insurance is no longer available.  In this case, the husband had the ability to convert the policy but that is not always the case.  Moreover, if the policy is converted from a group policy to an individual policy, the cost to the employee can go up dramatically.  Thus, if it is the parties' intention that the work related policy be maintained only so long as it is available through employment at little or no cost, they should say so in their agreement. 

Another issue that comes up from time to time is that someone has a term policy that either expires or the cost increases greatly such the the new premium or a new policy would be cost prohibitive.  Now, if a person does not have a support obligation to secure, this may be no big deal and they can choose not to have insurance anymore.  However, the problem arises if they have to secure alimony or child support.

In a situation where someone has a term policy that expires or has an increasing premium at a certain age, at the time of the divorce they may be better served to go out and get a new policy that covers their needs into the future, before the premiums become cost prohibitive (or even worse, before they can no longer get insurance).  Similarly, one must give serious consideration as to whether they want to use work related insurance to cover their obligation so that they are not in the same boat as Mr. Starr was in this case. 

Preparing for the Divorce Process

Previously, Sandra Fava, a contributor to this blog, did a piece on preparing for the initial divorce consultation with a lawyer.  The process, however, starts even before that.  On our web site, we have an advice piece entitled Preparing for the Divorce Process

Since it is linked to this post, I will not repeat everything contained in the piece.  However, the topics contained in that piece are as follows:

  1. Speak to an attorney now, not later
  2. Selecting the right attorney (including how to get referrals for an attorney)
  3. Gathering documentation
  4. Preparing for the initial meeting
  5. Telling the truth
  6. Keeping a diary; and
  7. Trusting your attorney for legal advice (as opposed to friends, family members, co-workers, etc.)

Do I stay or do I go? This is not an easy question to answer. However, if you are even
contemplating a divorce, divorce planning (and not in the nefarious way that often goes with this phrase) is essential, especially in difficult economic times.  Divorce can be a long, highly charged, expensive process - emotionally and economically. Being prepared and keeping
perspective, at least as much as humanly possible, can help you save time and legal fees
while protecting your and your children's interests.

Tax Treatment of Excessive Perks and Personal Expenses for Business Valuation Purposes

I recently blogged on the issue of how to treat unreported income, perks and other personal expenses paid through the business and the treatment of same for support purposes.  As noted in that post, the issue comes up both for support and business valuation purposes. 

In order to value a business, the experts come up with an income stream that gets capitalized.  That income stream is tax affected.  That is where the issue gets interesting.  More often than not, the experts tax affect the entire income, after adding back the perks, personal expenses, non-operating expenses, unreported income, etc. 

I have asked several of the forensic accountants why this is being done if this is note the economic reality for the business owner in that case.  More often than not, I have been told that you cannot assume that a buyer of the business would not declare all of the income and/or would improperly pay expenses through the business.  From a pure business valuation perspective, this seems correct and reasonable.

For purposes of equitable distribution, that remains questionable.  In the seminal case on business valuation in divorce in NJ, Brown v. Brown, discounts for lack of marketability and lack of control were not considered because the business was not really being sold.  Some have argued that Brown means a value to the holder standard is to be applied.  While I am not sure that that is the case, if discounts are not applied because there is no sale, then why are these excess perks and personal expenses tax affected when doing so artificially reduces the value of the business?  Put another way, if the business owner is not paying taxes on these things, why should there be this fictional tax be applied, which only serves to reduce value? At some point, I am sure this issue will be litigated further.  Until then, we will continue making the arguments on both sides.

Appellate Division Holds that Trial Court Cannot Cap a Party's Counsel Fees

Can a trial court tell a litigant is a divorce that they don't have to pay their lawyer more than a capped amount.?  On November 30, 2010, the Appellate Division in the unreported case entitled McClutchy v. McClutchy answered this question no.

In this case, what apparently was a hotly contested matter that went to trial, but which the trial judge deemed ordinary and not complex, at the end of the trial the court was called upon to assess the parties' respective request for counsel fees that they were asking the other party to pay. Normally, each attorney would submit a Certification of Services required by Court Rule explaining and listing the work done. In this however, the trial court limited them to a one page submission about what was owed and what had been paid.  Thereafter, the trial judge, thinking that the parties' respective fees were excessive ruled that the parties fees were capped at $50,000 each, despite that substantially more had been expended and was owed, and moreover, that the lawyers could not seek to collect the amount over and above.  One of the things the judge commented on was that he thought that the matter could have been handled by an associate, as opposed to experienced counsel of the client's choosing.

The Appellate Division reversed this decision finding that it was beyond the scope of the trial court's authority, especially where the client was not objecting to the fee.  Even if that were to have happened, there are other avenues to address this and the trial court could not do so.

This case, while clearly an aberration in the system, raises several issues.  First, if a client retains and wants pre-eminent counsel to represent them, it is not for the court to dispute their right to hire counsel of their choosing.  in addition, there are times where cases that seem "easy" or "garden variety" do not settle.  Some times it is because one party is unreasonable or acts in bad faith.  Some times it is because both parties are unreasonable.  Some times it is because one party does not want a divorce so they drag the matter out with the hopes that the other spouse will "come to his/her senses" and take him/her back.  Of course, by precluding the filing of a Certification of Services, the Court did not get to see what was done and perhaps did not get information as to why this seemingly easy case went to trial. 

This case is another cautionary tale.  Things aren't always as they seem.  Litigant's have a right to pursue issues in court and have a court make a decision on.  They also have a right to fully present their request for counsel fees to explain why the quantum of fees was what it was.

Court Finds That Someone Who Doesn't Pay Their Taxes Cannot Have Child Support Calculated As if They Did

On October 28, 2010, the Appellate Division issued a very interesting opinion in the case of Holden v. Holden.  While I will be doing another blog on the aspect of the case dealing with child support when the parties' incomes exceed the Child Support Guidelines, this blog deals with an interesting decision regarding determination of income - particularly net income - for child support purposes. 

In this case, the father's salary was $240,000,  In his submission to the court, her argued that his budget included a tax reserve for anticipated taxes and an amount for debt service for past due taxes.  The mother argued in response that the husband's gross income should be treated as net income (child support is calculated after determining net income under the Child Support Guidelines) since the husband had not paid federal taxes since 1997, and in fact, the father sought employment outside of the country to evade his taxes.

The trial court agreed with the mother finding that the father failed to present credible evidence of withholding taxes and based upon his past practice of ignoring his tax obligations, based his support obligation on $240,000.  The Appellate Division affirmed.

This is a refreshing application of economic reality to get to a fair result.  Though not precedential, I think the arguments can be possibly extended.  In your average case, the Child Support Guidelines calculate taxes based upon published tax schedules, as opposed to actual taxes paid.  If someones actual tax obligation is far less, because they have additional deductions or for any other reason, they actually have more net income than the Guidelines calculations might reflect.  This case certainly gives rise to an argument that actual taxes paid should be used. 

Moreover, sometimes we add back perquisites to income and, in fact, the Guidelines say that "in-kind" benefits are income.  However, if they in-kind benefits are not taxes, why should they be added to income and tax effected for support purposes?  Similarly, when someone is self employed and the business pays personal expenses (legitimate or not) that get added back to income, why should they be tax affected if tax is not actually paid? 

If the goal is fairness based upon economic reality, this case actually provides an arrow in an party's quiver to make the argument that reality should be considered.

When Change of Circumstances is Not Really a Change Necessary to Modify Custody

This post was written by Jessica Goldberg, a new associate in the Family Law Practice Group in the Roseland office and also, a new contributor to this blog.

The recent Appellate Division’s decision in Dunn v. Willis, although unpublished and therefore not precedential, brings up some interesting issues regarding custody disputes. First, it is important to note that when a judge is asked to consider a change in custody, that judge must first find that there has been a change in circumstances warranting further proceedings. In Dunn v. Willis the Judge concluded that the mother, who was seeking custody of her son, had failed to show the necessary changed circumstances. The Appellate Division agreed with the Family Court Judge and within its’ decision a warning can be construed about the dangers of too often involving the Court in family matters.

The history of this case is as follows: Mom, unmarried, had an alcohol abuse problem and although she had stopped drinking by November 2002, she was participating in an inpatient rehabilitation program and the Division of Youth and Family Services was involved with the family. In January 2003 the Court entered a consent order, signed by mom, the child’s maternal grandparents, and the child’s paternal grandparents. This consent order gave custody to the maternal grandparents and visitation rights to the paternal grandparents with the condition that the child’s father not be present during their visitation time. In August of 2003 mom was awarded parenting time with her child. In 2004 mom’s stability begins to become apparent – she is out of rehab, she has a full-time job and she has bought a home near the child’s school. In October 2004 mom makes a motion for a change in custody, but the Court denies this motion. In May 2007 mom gets a bachelors degree in nursing. In December 2007 the Court enters an order increasing mom’s parenting time, however, the Court again denies mom custody. Finally, in April of 2008 mom is awarded joint legal custody with her parents, the child’s maternal grandparents. Another order is entered in June 2008 restricting mom from making unilateral decisions without approval from her parents with whom she shares custody.

Then, in June 2009, mom files a motion, now the subject of this Appellate decision, to obtain custody of her son. By this time mom is working full-time as a nurse and is about to receive her Masters Degree in nursing. Her relationship with the child’s father has improved to the point where they are communicating and the child is building a relationship with his father and the father’s younger son. During this entire time the child has lived with his maternal grandparents and an older half-sister, however, the half-sister is now going off to college and mom asserts that the child, now eleven years old, wants to live with her. The Court, however, denies mom’s request to interview the child or appoint an expert to evaluate whether a change would be in the child’s best interest. The Court denies mom’s motion on the grounds that mom has failed to show the necessary changed circumstances.

The Appellate Court, in affirming the Judge’s decision, points out that the Judge who addressed the Custody issue in 2009 had also entered the orders in December 2007 and June 2008. The Appellate Court states that “[the circumstances relevant on this application were only those that had changed since April 2008” when mom was awarded joint legal custody. The Appellate Court highlights that mom’s success and progress from the circumstances that surrounded her family in 2003, when her parents were awarded custody of her son, were all known in 2008 when she received joint custody. Therefore, all of moms’ progress cannot be considered in 2009. When we look at the facts of this case from 2003 through 2009 we see substantial changes – mom went from a parent with an alcohol problem in an inpatient rehabilitation program to a homeowner with a full-time nursing job on the verge of receiving a Master’s degree. When the case is considered from 2008 to 2009, however, as the Family Court Judge considered it, there are very few changes in circumstance.

This case can be viewed as a warning about litigating a matter too frequently. This child had been living with grandparents for a long time and it is not clear from the facts that it would have been in his best interest to go and live with mom. If, however, the Court had not been so involved through out the years and if the Judge had been looking at the facts for the first time in 2009 since the initial consent order in 2003, it is safe to say that he would have at least found a significant change in circumstances and, at the very least, he would have been compelled to proceed with an investigation into the custody matter – interview the child, appoint an expert, etc. I concede that it is difficult to stay out of Court when the Division of Youth and Family Services is involved.  But there is a lesson here for any party getting involved in a custody matter. A party should be careful about how many times they file a motion and ask the Courts to review the facts of their case. If a party has designs about seeking major changes in a parenting plan or custodial situation in the future, a party should be careful about entering into a consent order for small changes.  They should be wary of baby steps, because each time a Court enters an order, whether by consent or otherwise, those facts and that time period become the circumstances and point in history a judge will look to first when asked to consider the matter again.
 

Shared Custody - It is a Possibility

I suspect that anyone that read my last blog might think that I am against shared custody or that I believe it to be impossible.  That is not the case.  Rather, my point in that post was to address possibly bad faith requests for joint custody by those people who have historically neither spent a lot of time with the children nor did much of the actual parenting.

But shared parenting time is not an impossibility.  Supposedly, it requires parents who have the ability to communicate and cooperate.  That said, I have seen parents who cannot have a civil word with each other effectively co-parent. 

Shared parenting, by New Jersey standards, is anything between 28% (104 overnights) and 50% of the overnights with the children.  Curiously, these definitions actually stem from the child support guidelines.  When the newest iteration of the Guidelines came into being in 1997 or 1998, they had two different worksheets - a sole parenting worksheet and a shared parenting worksheet (104 overnights and over).  While non-custodial parents now got child support reductions with each overnight, the credit was greater using a shared parenting worksheet. As a result of the new guidelines, negotiations over additional overnights began, in many cases for obvious reasons.

However, in the context of shared parenting that was the subject of my prior blog and this one, I am talking about substantially more time, basically 40-50 percent of the overnights.

For parents who were both very involved with the children and who schedules allow, this is a possibility.  Again, I am not sure that it is realistic in most cases where one parent was a stay at home parent and the other left the house at 6 am and got home at 7 or 8 p.m.  But in cases where there is flexibility in the work schedule and/or the ability to spend a lot of time, coupled with significant prior involvement, shared parenting, in my opinion, can be considered.

I often tell fathers (typically), that they don't have to settle for alternate weekends plus one night a week for dinner (one rather old fashioned judge called this the "off the shelf" parenting plan.)  Rather, if they want more time and really can exercise it, that they should seek it.  In fact, over the last decade or so, in most custody evaluations I have seen, it has been rare that simply the "off the shelf" parenting plan is ever recommended.  Keeping in line with much of the new research saying that children should spend as much time as possible with each parent, most of the evaluations I have seen recommend some type of shared parenting (more than 28% but usually not 50%). 

 

The bottom line is that when logistically possible and when sought for the right reasons, shared parenting could very well be in the children's best interests.

"Settlement Anxiety" - An Effective Tool or an Unfair One?

Recently, I was at a mediation where the mediator, when telling us his assessment of my client's case, said that he was creating "settlement anxiety."  I had never heard this term but what I believe was meant was that the mediator wanted the client to have "anxiety" about his/her position in order to be more likely to make compromises and settle.  If the goal is getting a settlement at all costs, I guess it makes sense - but is it fair?

In most cases, there is a "realm of reasonableness" or a range in which any settlement would be essentially fair.   Perhaps, a fair alimony figure could be between $100,000 per year and $125,000 per year.  A fair resolution could be either of those numbers and anything in the middle.  In most cases, people, with all relevant facts and acting reasonably, negotiate within the realm of reasonableness, but at either end depending on which side of the case they are on.  In that case, a mediator trying to create "settlement anxiety" will try to express the flaws in either case to get the parties to meet somewhere in the middle to achieve a result that is fair.

But what about cases where one party is negotiating within the realm of reasonableness and the other is not?  Put another way, what about cases where one party has the law and the facts pretty much on their side as to most issues and the other side is taking a position that is absurd?  In this case, should the mediator be trying to create similar "settlement anxiety" in both parties?  Add another level - what if the mediator knows that the unreasonable party will never settle the matter in a reasonable fashion?  Should the mediator pressure/create the same amount of "anxiety" in the more reasonable party just to achieve a settlement even though everyone knows it is unfair?  Should the result be settlement at all costs?  Does this type of pressure on the righteous party just to get a deal done artificially undermine a party's relationship with her counsel and experts, if just for settlement purposes, they are told that their case is weak when it is not? 

In my humble opinion, pointing out the legitimate limitations in someones case in order to help create a settlement is fair and appropriate.  On the other hand, creating artificial anxiety just to get a settlement all all costs because one party is acting unreasonably or negotiating in bad faith is not.  The system should be fair and equitable and the parties are entitled to justice.  It is neither fair nor justice to lessen a party's confidence in their case, artificially, just because the other side will never settle in a fair and reasonable manner.  That does not mean a party cannot give more ore receive less just to get a case done and move on with their life.  That is their choice.  On the other hand, they should not be manipulated just because the other side refuses to be reasonable.  And as I have said before, sometimes you just have to try a case.

NJ Supreme Court Refuses to Hear Attack on Inequities of Civil Union Statute

On July 26, 2010, an equally divided New Jersey Supreme Court refused to hear an attack on civil union statute in a motion filed in the Lewis v. Harris case.  Rather, the Court's Order held that the matter cannot be decided without a trial like record and as such, denied the motion without prejudice for a new law suit to be filed.  The Order specifically noted that it made no determination on the consitutionality of the civil union statute.

In the dissent by the other three Justices, they framed the issue as follows:

Plaintiffs are six committed same-sex couples who have filed a motion in aid of litigants’ rights claiming that almost four years after Lewis v. Harris, 188 N.J. 415 (2006), and three-and-one-half years after passage of the Civil Union Act, N.J.S.A. 37:1-28 to -36, they still are denied the “full rights and benefits enjoyed by heterosexual married couples” mandated by the equal-protection guarantee of Article I, Paragraph 1 of the New Jersey Constitution. In their papers, plaintiffs detail a host of workplace, public accommodation, family law, economic, and various other “rights and benefits” that, they allege, are
not afforded to them despite the Civil Union Act and the command in Lewis. In addition to certifications by the parties, plaintiffs cite to the report of the Civil Union Review Commission, N.J.S.A. 37:1-36, a body established by the Legislature as part of the Civil Union Act to evaluate the Act’s success, which concluded that civil unions have failed to deliver the mandate of equality guaranteed by Article I, paragraph 1. However, plaintiffs’ record has not been tested in the crucible of a litigated matter. Thus, we realize that we do not have a sufficient basis for debating the merits of the application, which raises a matter of general public importance and one of constitutional significance.

The next step should be the development of a record on which those important issues can be resolved quickly. At the very least, oral argument would have helped to guide us on the best procedural course for creating such a record. We are disappointed that three members of the Court have voted to deny the motion without oral argument and that plaintiffs must now begin anew and file a complaint in the
Superior Court seeking the relief to which they claim they are entitled. If plaintiffs’ allegations are true -- and we will not surmise whether they are or are not -- then the constitutional inequities should be addressed without any unnecessary delay. Therefore, we would hope that the proceedings in the Superior Court will be conducted with all deliberate speed.

One wonders whether there would have been a different result had Justice Wallace had been granted tenure and there was a full court of seven members.  That said, stay tuned for the next installment once the next round of litigation of this issue begins.

Is No-Fault Divorce Coming to NY? We Have it in NJ

On June 15, 2010, the New York Times reported on several proposed new laws affecting family law practice in New York.  One was to adopt no-fault divorce, which has long been proposed and long been opposed. At present, one still must prove fault grounds for divorce in order to get a divorce.  This has lead to protracted litigation that some have called cruel and unnecessary.  As the no-fault bill has finally passed the Senate, there is an expectation that it will also pass the assembly.

New Jersey has had no fault divorce for many years, though in actuality, it has really been prevalent for the last 4 years or so when "irreconcilable differences" were added as a cause of action.  Prior to that, the only no-fault ground was 18 month separation.  As most people did not want to wait 18 months, the majority of divorce complaint alleged "extreme cruelty" that made it unreasonable and improper to require the parties to remain married.  In many ways this was somewhat bogus because there was rarely any real testimony about the allegations other than to re-affirm that what was in the complaint was true and correct and if asked to testify about it at length, the testimony would be substantially the same. 

That said, despite telling parties not to worry about it and not to get upset about it, they almost always did (not to mention that there was no a public record of very private gripes).  As such, the other party would then file a counterclaim alleging their own version of "cruelty."  Thankfully, irreconcilable differences has in most cases done away with the need to go through the financial and emotional expense of this type of Complaint (though there are times when it is still necessary for other reasons). 

The only thing that I miss as a divorce lawyer in not reviewing the cruelty complaint and counterclaim is that it may take a little longer to really understand the dynamic between the parties that often would come out loud and clear in their initial pleadings.  That said, no-fault is still better in most cases.

Hello Cohabitation. Goodbye Alimony.

What happens when a dependent spouse begins living with another partner? Well, in the recent unpublished decision of Hartelust v. Hartelust the Appellate Division reviewed this question. Docket No. A-2519-08T3, decided January 12, 2010. 

Plaintiff Nora Hartelust appealed from an August 1, 2008 Order that terminated Defendant Alexander Hartelust’s alimony obligation.   After twenty years of marriage the couple was divorced in January 2007. The judgment of divorce incorporated the property settlement agreement (PSA).   At the time, the couple had a fifteen year old child, Alexander was earning $60,000/year and Nora was earning $15,000 per year. The PSA stated that Alexander would pay $175 per week in child support, $220 per week in permanent alimony, and transfer his ownership in the marital home to Nora. The PSA did not address cohabitation.

In April of 2007, Alexander became aware that Nora was cohabitating in the former marital home with her boyfriend. Alexander immediately stopped paying alimony and in July 2007, three months later, filed a motion seeking termination of alimony.  After a plenary hearing where the parties, the boyfriend, and the couple’s son testified, the trial judge found that Nora was cohabitating with her boyfriend and was deriving an economic benefit. The judge ordered that Alexander stop paying alimony and awarded Alexander attorney’s fees. Nora appealed. On appeal the Appellate Division affirmed the termination of alimony because the trial judge had determined that based on credible testimony, Nora was cohabitating with her boyfriend and received an economic benefit from that cohabitation. The Appellate Division explained that once there is a prima facie showing of cohabitation, the burden of proof is shifted from the party seeking modification to the dependent spouse, who must show that he or she has not derived an economic benefit from the cohabitation. Nora could not overcome that burden.

Also on appeal was the award of attorney’s fees, which the Appellate Division reversed. The Appellate Division found that the judge failed to consider seven of the nine factors when determining if attorney’s fees were warranted. In this case the attorney failed to submit a Certification of Services, which impacted the Appellate Division's ruling. In order for attorney’s fees to be ordered, an attorney must submit a certification or affidavit of the services they provided.

 

While this matter is unpublished and therefore not binding, given the law of this state the outcome exemplifies the way the law was meant to be interpreted. Recently, virtually this very same issue was faced by a client and although the spouse admitted to cohabitation, the trial judge did not find that our client had met his prima facie burden and therefore, would not order a plenary hearing. While disappointing, this case further supports our belief that our client was entitled to this hearing, at the very least.

A PARENT'S OBLIGATION TO PAY FOR POST-HIGH SCHOOL EDUCATION

What payment obligation, if any, do divorced parents have towards their child's post-high school education?  The New Jersey Supreme Court concluded more than 25 years ago that a child's right to support includes a "necessary education" after high school, whether it be a vocational school or college.  However, a parent's obligation to pay for such schooling depends generally on the expectations and abilities of the parties involved to pay, as set forth in 12 different factors including:

1.  whether the parent, if still living with the child, would have contributed toward the costs of the requested higher education;

2.  the effect of the background, values and goals of the parent on the reasonableness of the expectation of the child for higher education;

3.  the amount of the contribution sought by the child for the cost of higher education;

4.  the ability of the parent to pay that cost;

5.  the relationship of the requested contribution to the kind of school or course of study sought by the child;

6.  the financial resources of both parents;

7.  the commitment to and aptitude of the child for the requested education;

8.  the financial resources of the child, including assets owned individually or held in custodianship or trust;

9.  the ability of the child to earn income during the school year or on vacation;

10.  the availability of financial aid in the form of college grants and loans;

11.  the child's relationship to the paying parent, including mutual affection and shared goals as well as responsiveness to parental advice and guidance; and

12.  the relationship of the education requested to any prior training and to the overall long-range goals of the child.

 

Notably, these factors contemplate that the parent or child seeking payment towards educational expenses will be made before the expenses are actually incurred.  The Appellate Division addressed this timing issue in the recent unreported (not precedential) decision of Gorman v. Cruz, where it reversedd a trial court's denial of a mother's application to compel payment by the father for the daughter's beauty school because the child failed to apply for school costs from the father until the costs had already been incurred and paid.

Reversing the trial court's decision, the Appellate Division noted that delay in seeking payment from the parent is only one factor for consideration and by no means warrants an automatic denial.  The father had already contributed to the cost of the school, demonstrating his approval, or at least acquiescence towards his daughter's decision to obtain her cosmetology education, as well as his ability and willingness to pay.  The Appellate Division also rejected the father's argument that he was only obligated to pay for college - not a "technical" school like beauty school - relying on a rational construction of the terms of the parents' matrimonial settlement agreement as to the children's education and its general purpose to support the children in pursuing their career goals. 

As this case demonstrates, a thorough review of the 12 factors above, as well as the timing of the payment request, is necessary to determine a parent's obligation to pay for post-high school education costs.   

YET ANOTHER CELEBRITY DIVORCE - DODGER STYLE

Since they have been in the news a lot lately, I have bloged a lot recently on celebrity divorces, be it John & Kate, Stephanie Seymour or Jim Nantz.  That is why the article from Billy Witz that recently appeared in the New York Times about the divorce of Frank McCourt and Jamie McCourt, the owners of the Los Angeles Dodgers got my attention.

Both parties claim to own the team - though Frank claims to be the sole owner.  Both worked for the team until recently, when Jamie was fired.  As a sign of the war to come, Jamie's lawyers budgeted her legal fees for this matter to be $2 million.  Per the article, the central issue is as follows:

"The key legal issue is whether the Dodgers are considered the McCourts’ community property. Under California law, a couple’s assets are split 50-50 unless a written agreement states otherwise. Shortly after buying the Dodgers, the McCourts put the team in Frank’s name and all their property in Jamie’s name to protect the homes from potential creditors. One of her lawyers, Michael Kump, said they would challenge the validity of the postnuptial agreement.

If the agreement is not valid, Fisher said, the McCourts would probably be forced to sell, as John Moores did with the San Diego Padres when he divorced."
 

The result would probably be the same in New Jersey.  It seems pretty clear that when people divorce, the cannot remain in business together.  In fact, in the well known Borodinsky case, the Appellate Division held:

 It seems almost doctrinal that the elimination of the source of strife and friction is to be sought by the judge in devising the scheme of distribution, and the financial affairs of the parties should be separated as far as possible.  If the parties cannot get along as husband and wife, it is not likely that they will get along as business partners.

Obviously this is the case with the fighting McCourts.  We will pay close attention as to how this works out but until then, play ball.

PARENTAL ALIENATION SYNDROME - IS A DSM MENTAL DIAGNOSIS ON THE WAY?

We have blogged in the past about parental alienation and "Parental Alienation Syndrome."  There was an excellent article in US News and World Report on line posted on October 29, 2009.  To read the article, click here.  To view some of our prior posts on this topic, click here and here.

The article discusses a movement afoot to add "parental alienation" to the next addition of the DSM (ie. Diagnostic and Statistical Manual of Mental Disorders) published by the American Psychiatric Association.  The new edition is scheduled to be published in 2012. 

While there appears to be little debate on whether parental alienation in both subtle and not so subtle forms goes on, there is a debate as to whether it represents a mental illness.  On top of that, there is concern that certain opposition to visiting with a parent could either be age appropriate (eg. a teenager being oppositional) or otherwise justified.  The people of this view are concerned that making parental alienation a mental illness could be invoked by an abusive parent to gain visitation with a child that has good reason to oppose contact.

No matter where you stand on the debate as to whether parental alienation is a mental illness, it is clear that alienating behavior in whatever form, big or small, cannot be good for the children that are exposed to it.