We have blogged many times about cases dealing with motions for reductions of child support and alimony. Obviously, that has been a hot topic given the economic downturn that our country has experienced over the last year or so. Another interesting unreported (non-precedential) case was released on November 2, 2009.
That case was Miele v. Miele. In this case, the parties divorced in 2005. In their Agreement, the husband’s support was based upon anticipated gross income of $165,000 per year. The reason for this was because he involuntarily changed employment in 2005. In 2004 he earned more than $331,000. Because of these circumstances, the parties agreement required them to exchange W-2 and 1099 forms for 2006, 2007 2008.
The husband’s post divorce income did not approach even the $165,000 level. As a result, he made a motion to reduce his alimony in 2007 which was denied. He filed another motion in 2008 which also was denied. This time, he appealed.
The Appellate Division reversed. The Appellate Court found that the parties agreement recognized that there was an involuntary reduction in income and that the $165,000 number was a projection of future income that did not come to fruition. Given that the husband had shown two, if not three straight years of income that was substantially below the anticipated gross income, he was entitled to, at the very least, entitled to a hearing.
This case is instructive because I would anticipate that many current divorces will be faced with a similar situation of someone who lost their job and their new income is speculative. The parties should attempt to include protections in the agreement that take into account that the income could go back to historical levels, as well as what should happen if it does not.