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

I was reading an unreported Appellate Division case released today and gasped when I read the following sentence, " ...Moreover, the permanent alimony figure was negotiated and presumably contemplated defendant's retirement since he was fifty-three years old when he appeared before Judge Piscal on September 19, 2000."  To read the full case, click here.

While the facts in this case may have justified the denial of the former husband's motion to modify alimony, that statement struck a chord.  In this case, the parties were married for 32 years, a long term marriage by any standards.  However, by current standards, we often start talking about long term marriages being 15 years or more and if alimony is appropriate, the discussion is about permanent alimony begins.  Moreover, although there is a well known Appellate Division case authored by Judge (now Supreme Court Justice) Long suggesting that it is better practice to negotiate the issue of retirement, the reality in practice is that it is rare that the party receiving alimony will concede the issue of retirement in the agreement.  Often it is just too speculative.  At best, you may get a recognition that there can be an application for a review upon retirement.

Given that you typically cannot get any concession about retirement and there is no doubt that this was a permanent alimony case, is the above quoted statement a fair or a realistic view?  I don't think so. 

Assume a long term marriage where all assets, including retirement assets are equally divided.  The law is clear that you cannot look to assets divided in equitable distribution for support.  Post-divorce assets can be considered.  If in the 8 or 10 or 12 years after the divorce, after paying alimony and perhaps child support, the payor does not accumulate substantial assets, then what.  What if he bought a new house with his equitable distribution and did contribute the max to his 401k during the post divorce years.  In this economy , the value of the home and the 401k could be down substantially.

More importantly, one would think by this sentence that someone who agrees to permanent alimony can never retire.  This, however, is wrong as a matter of law.  Thus, for a court to determine that a retirement by a person who was age 53 when he agreed to permanent alimony was contemplated in the agreement, is both practically unrealistic and legally incorrect in my opinion. 

That said, as noted above, the denial of the motion to modify under the specific facts in that case made perfect sense.

However, I think it is essential, if possible, to at least get recognition in a Marital Settlement Agreement, that, if nothing else, the issue of retirement was discussed but unresolved to best preserve the issue for another day.

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Retiring from the workforce does not necessarily mean retiring from your child support obligations.  Rather, the circumstances of each case will dictate whether a person retiring in good faith can successfully obtain a child support modification.  

The Appellate Division recently addressed this issue in Kassin v. Kassin, affirming a trial court’s decision denying a defendant father’s motion to modify his child support obligation after he was terminated from his job at age 65 due to a heart-related condition. The parties were married for 25 years and 6 children were born of the marriage prior to the parties’ divorce in 1998. At the time of the divorce, the father was employed and earning approximately $23,000 annually. At the time of his motion for a support modification, 1 of the 6 children, age 15, was still unemancipated. In March 2007, at age 65, the father was terminated from his job. He claimed in his motion that the termination was caused by his inability to perform his job duties due to a heart-related medical condition and that he was unable to secure other employment for the same reasons. He also asserted that, as a result, his only income came in the form of social security benefits and charitable assistance from private agencies, thus providing him with an annual income of approximately $20,000. It was upon these facts that the father claimed the existence of changed circumstances justifying a modification pursuant to Lepis v. Lepis, 83 N.J. 139 (1980).

Citing to Silvan v. Sylvan, 267 N.J. Super. 578 (App. Div. 1993), the Appellate Division based its decision on the following non-exhaustive list of factors to consider when a party retires at age 65 and subsists on social security benefits: 

• the age gap between the parties;
• whether at the time of the initial alimony award any attention was given by the parties to the possibility of future retirement;
• whether the particular retirement was mandatory or voluntary;
• whether the particular retirement occurred earlier than might have been anticipated at the time alimony was awarded;
• the financial impact of that retirement upon the respective financial positions of the parties; and
• the motivation which led to the decision to retire, i.e., was it reasonable under all the circumstances or motivated primarily by a desire to reduce the alimony of a former spouse. 

In denying the father’s motion, the Court concluded that the father failed to submit evidence sufficiently linking his medical condition to his inability to work and of his search for other employment, as well as the fact that the income differential pre- and post-job termination was too insubstantial to constitute a changed circumstance. Notably, the Court reminded the father that, as a so-called "late in life" parent who, at age 65, still had an unemancipated child, he was responsible for working and saving for this child beyond an otherwise expected age.

Also of note was that, despite denying the father’s motion, the Court nevertheless remanded the case for a credit to be calculated on the father’s child support obligation pursuant to New Jersey’s Child Support Guidelines because the mother was receiving social security benefits for the unemancipated child.

This case highlights how simply wanting to retire early in good faith (rather than retiring to simply avoid a support obligation) is not as easy as it seems when the potential retiree has existing child support (similar issues arise in the context of alimony) obligations. 

EDITOR'S NOTE:  It seems unlikely as a matter of public policy that someone will ever be allowed to "retire" under any circumstances to avoid a child support obligation.  If there is a bona fide disability, that is another story however as that is usually beyond the obligor's control.  Absent disability, late in life parents will more likely than not be required to keep working and/or otherwise be required to pay support until all of their children are emancipated. - Eric S. Solotoff

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