It’s a story as old as time in the New Jersey courts. Alimony is set based upon the income of parties to a divorce, but then years later, a spouse loses his or her job and is unable to continue to make the agreed upon or ordered payments. What is a Court to do?

61199328 - the word of alimony on wooden cubes

In the old days, prior to the enactment of the new alimony statute, judges had certain checklists, gathered from all the law that they typically used to assess whether to obligor would gain relief. You can find that checklist I compiled in 2013 here.

However, now that the new statute is in effect, the question becomes, how should judges treat on obligor’s loss of employment?

Mills v. Mills, an opinion by Judge Jones of Ocean County, approved for publication, provides some guidance on the issue.
In the Mills case, the parties divorced in 2013 after a 13-year marriage. At the time of the divorce, the parties agreed that the Husband would pay the Wife alimony in the amount of $330 per week for 8 years, as well as child support in the amount of $200 per week. This award was based upon the Husband’s income as a district sales manager for a company selling residential and commercial flooring services, earning $108,000 per year and the wife’s income as a teacher, earning $59,000 per year.

In January 2015, after 12 years of employment at the flooring company, the Husband lost his job. The job loss was involuntary; it stemmed from his employer’s decision to restructure its business plan and eliminate the Husband’s position.

The Husband began searching for a new job immediately. In April, 2015, he received an offer of employment form another flooring company, but at a significantly lower salary of $70,000, with a $6,000 car allowance.

At this point, the Husband was faced with a difficult decision – does he accept the job at a lower rate, or decline the opportunity and look for another job closer to his prior income? Ultimately, he decided to accept the new job.

Initially after accepting the new job, the Husband continued to pay alimony at the rate of $330 per week. He had received severance pay of $35,000 and was able to temporarily supplement his income from there. However, as the year neared its end, the Husband had depleted all reserves.

The Husband filed a motion on November 24, 2015 for a prospective modification and reduction of his support obligations based upon a substantial change in circumstances. In the meantime, he earned a performance bonus of $6,000, bringing his total compensation t $82,000, which still constituted a $26,000 from his prior income.

The Wife opposed the motion, and questioned the circumstances under which the Husband lost his prior employment, and that even if the loss was involuntary, he had not demonstrated that he could no longer earn at least $108,000. She also stated that the loss of support would create economic difficulties for her.

The parties were unable to resolve their differences and the matter proceeded to a contested hearing. The Husband testified that when he began at the flooring company, he was earning $50,000 and gradually worked his way up to a salary of $108,000. The Court found that he testified credibly that he could not simply walk into a new position at a new company and immediately command the same salary.
Interesting, the Court began its legal analysis by expounding upon a “Catch 22” in which many obligors found themselves under the old statute.

…no matter what decision he or she made in accepting or declining a new position at a lower pay, that decision might subsequently be critiqued, criticized and even legally challenged by an ex-spouse who, in resisting a reduction in alimony, might contend that the supporting spouse made an inappropriate choice and therefore should not receive a reduction in his or her support obligation   … when a supporting spouse lost his or her job and then declined an offer to take a lower paying position…and instead kept searching for a higher paying position while seeking a reduction in support, the supported spouse would often argue that the obligor unreasonably bypassed an opportunity to earn at least some income that could have been used to pay some of the ongoing support obligation…

Reciprocally, if a supporting spouse accepted the offer for new employment at a substantially lower salary and then sought a reduction in support, a supported spouse would often argue that the obligor was underemployed because he or she accepted a position at a significantly decreased level of pay or proven “income potential”…

Judge Jones rejected the suggestion that there is a “one-size-fits-all” legal analysis for approaching and analyzing these types of issues. In that regard, he stated “imputation of income was a discretionary matter not always capable of precise or exact determination”.

After citing the amended alimony statute – N.J.S.A. 2:a:34-23(k) – for guidance as to how to analyze this issue. In doing so, he specifically referenced subsection (2), which expressly references that when an obligor loses his or her employment, a judge may consider the obligor’s documented efforts to obtain replacement employment or pursue an alternative occupation, as well as subsection (3) which provides that a court may consider the obligor’s good faith effort to find remunerative employment at any level in any field.

However, the Judge noted that the amended statute does not expressly establish or provide a specific standard for statutory analysis in situations when an obligor actually obtains new employment at a significantly lower pay, then seeks to reduce his or her support obligation over the supported spouse’s objections.

The Court concluded that as a matter of equity, fairness, as well as the most reasonable, consistent and straightforward analysis would be addressed by the following two-step inquiry:

(1) Was the supporting spouse’s choice in accepting a particular replacement employment opportunity objectively reasonable under the totality of the circumstances?
(2) If so, what if any resulting support adjustment should occur that is fair and reasonable to both parties, given their respective situations?

In applying this two-step inquiry, as well as the statutory mandates, the Court concluded that the loss of income was involuntary and that the Husband made legitimate efforts to obtain new employment in the same industry in good faith.

While the salary in the new position was lower, the Court found that the Husband nonetheless made an objectively reasonable decision in responsibly trying to begin at a new place of employment. In fact, the Court found that the Husband was very fortunate in this economy to find replacement work.

Nor did the Court find any objective evidence that the Husband was deliberately underemployed or unreasonably turned down or avoided other job opportunities at higher income levels.
After considering all the evidence, the Court reduced the Husband’s alimony obligation to $250 per week and his child support obligation to $194 per week.

With this decision, Judge Jones clearly articulated what I have personally heard many obligors say to me when deciding whether to move forward with a first, second or even third motion for a reduction in alimony based upon reduced income. Whatever step an obligor took, the supported spouse had a response; and one that was well supported by case law.

Either way, the supported spouse would argue that the reduction in income constituted underemployment and that the Court should impute income consistent with the obligor’s prior income.

Judge Jones’ decision provides a clearer analysis that Court should undertake in this all-too-familiar situation.
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Eliana Baer, Associate, Fox Rothschild LLPEliana T. Baer is a contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

Every family uses its money in different ways. Some families spend every cent they have on everything imaginable, others save every last possible cent for the proverbial “rainy day”, and many families fall somewhere in between. Once a marriage comes to an end, however, will both spouses be able to continue spending or saving in the same way they did during the marriage as part of the lifestyle lived?

New Jersey case law has long held that a trial court may consider a savings component as part of an alimony award to protect a dependent spouse from the potential future loss of income by allowing her to accumulate a post-Judgment safety net. One question that has never been answered until now, however, is whether a history of regular savings during the marriage as part of the marital lifestyle should be considered in setting an initial alimony award even when there is no need to protect the dependent spouse.

According to the Appellate Division in the newly published, precedential decision of Lombardi v. Lombardi, the answer is a resounding yes.

Kid counting money
Copyright: sbworld8 / 123RF Stock Photo

FACTS TO KNOW:

During the parties’ marriage, savings was the largest component of the parties’ lifestyle, but the trial judge rejected inclusion of a savings component when awarding alimony because the payee-wife did not need such funds to protect herself from a potential future loss of alimony. The parties jointly decided to live a comfortable lifestyle during which they saved approximately $70,000 per month, and budgeted most of the earned collective income so that the parties would have no worries about finances when paying for college and entering into retirement. In fact, the parties budgeted so efficiently that the payor-husband could retire at age 45 with an accumulation of $5 million in assets that could generate sufficient income to help fulfill the family’s lifestyle.

THE TRIAL COURT’S DECISION:

At trial, the wife indicated that she needed approximately $16,000 per month for herself and the three children to live a standard of living comparable to that lived during the marriage, exclusive of a savings component that she requested in the monthly amount of $30,000. She also sought $5,000 in monthly child support and for the husband to be responsible for all child-related supplemental expenses.

The trial judge acknowledged the existence of savings component during the marriage, but awarded a monthly permanent alimony payment of $7,600 based on a finding that the parties lived an undisputed “modest middle-class lifestyle” with a monthly budget of $14,516 (excluding savings). The $7,600 was calculated as sufficient to cover the shortfall in the wife’s budget after accounting for child support, monthly after-tax income estimated she could generate by investment of her share of equitable distribution (each party was receiving half of the roughly $5.5 million estate), and her after tax net income from part-time work.

Based on each party’s anticipated share of equitable distribution, the trial court found that each party had a significant opportunity to save and invest, even though the husband’s substantial income provided him with a far greater opportunity than the wife. Specifically, the court noted that the parties monthly average savings of approximately $87,000 was a “component of lifestyle” (whether for an early retirement or to enhance the parties’ economic security), but should be included in an alimony award “only [ ] to the extent it was necessary to ensure a dependent spouse’s economic security in the face of a later modification or cessation of support, which were not issues here.”

Even without a higher amount of alimony (inclusive of a savings component) the court noted that the wife could save (albeit at a lesser extent than that seen during the marriage) when considering:

  1. some “overlap” in the presented alimony and child support budgets;
  2. the wife’s right to claim the children as exemptions for tax purposes; and
  3. her “ability to work and retain earnings to use for savings . . . because of the maturation of the children . . . such that she would have more time to spend working if she chose to do so.”

The court also noted the wife would have no obligation to pay for college or any unreimbursed medical expense, the cost of extracurricular activities was covered by the “above guidelines” child support award, and if she wanted to work more she would be “protected against any claim that her alimony should be reduced or that she has lesser need,” and the alimony would likely never be reduced because of the husband’s income and assets. Summarizing its determination to exclude a savings component, the court held:

The [c]ourt finds that a permissible savings component which it elected not to do or not to include was because there are potentials for [plaintiff] to accumulate, earn, and otherwise be protected from a reduction by virtue of, one, reasons having to do with the current budget and the room in the budget to still save, the ability to work more without worry about a reduction in alimony, the investment opportunity that might enhance the return on the over $2 million that she will receive, the life insurance to protect against the death of the defendant, and the likelihood of a continued appreciation and increase in assets and earnings that . . . would protect her against any arbitrary . . . reduction in alimony based upon early retirement or otherwise.

The wife’s appeal followed.

THE APPELLATE DIVISION WEIGHS IN:

On appeal, the Appellate Division agreed with the wife’s position that the subject award allowed only the husband to maintain the standard of living experienced during the marriage, and that required Case Information Statement form, on its face, suggests that a savings component is a “fundamental element of the family lifestyle” because the savings category was specifically added to the budget portion of the form after its initial issuance.

Reviewing seminal New Jersey alimony law, the Court reminded that each party is entitled post-divorce to live a lifestyle reasonably comparable to that lived during the marriage, with neither party having a greater entitlement to do so than the other (as codified in the 2014 statutory amendments to the alimony law). As a result, the alimony award designed for the supported spouse to achieve such lifestyle that is ultimately the “touchstone for the initial alimony award.”

While noting how case law has long recognized that a savings component in an alimony award can protect a dependent spouse against the potential future termination of alimony, or to provide for future events such as retirement, the Court provided:

The most “appropriate case” in which to include a savings component is where the parties’ lifestyle included regular savings. Because it is the manner in which the parties use their income that is determinative when establishing a marital lifestyle, see Weishaus, supra, 180 N.J. at 145, there is no demonstrable difference between one family’s habitual use of its income to fund savings and another family’s use of its income to regularly purchase luxury cars or enjoy extravagant vacations. The use of family income for either purpose over the course of a long-term marriage requires the court to consider how the money is spent in determining the parties’ lifestyle, regardless of whether it was saved or spent on expensive purchases. The fact that the payment of the support ultimately is protected by life insurance or other financial tools, does not make the consideration of the savings component any less appropriate.

Rejecting the husband’s argument that the court appropriately considering savings through its equitable distribution award, the Appellate Division held:

The argument runs afoul of the rule that “equitable distribution determinations are intended to be in addition to, and not as substitutes for, alimony awards,” which are awarded to provide for the maintenance of the marital lifestyle post-dissolution. Steneken, supra, 183 N.J. at 299. Moreover, it is not equitable to require plaintiff to rely solely on the assets she received through equitable distribution to support the standard of living while defendant is not confronted with the same burden. As expressed under the alimony statute’s current version, the court must recognize that “neither party ha[s] a greater entitlement to that standard of living than the other.” N.J.S.A. 2A:34-23(b)(4).

In finding that its holding went beyond what most other jurisdictions provided regarding the savings component issue, the Court concluded:

We therefore hold that the Family Part must in its assessment of a marital lifestyle give due consideration to evidence of regular savings adhered to by the parties during the marriage, even if there is no concern about protecting an alimony award from future modification or cessation upon the death of the supporting spouse.

The issue of how to treat savings as part of the marital lifestyle under the type of circumstances present in Lombardi has long been discussed amongst family law attorneys without definitive judicial guidance.  Now that such guidance is here, this may not be the last we hear from the Lombardi family as perhaps the Supremes will ultimately weigh in.

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Robert A. EpsteinRobert Epstein is a partner in Fox Rothschild LLP’s Family Law Practice Group and practices throughout New Jersey.  He can be reached at (973) 994-7526, or repstein@foxrothschild.com.

Connect with Robert: Twitter_64 Linkedin

You have one household barely scraping by. You have two incomes, but the bills still pile up. From month to month, you pinch pennies, cut coupons and budget.
Now take that household, double the expenses, and cut the income in half.

Good luck.

This situation is something that millions of people face each day. One spouse leaves the residence, seeks a divorce and *surprise* you also need to help support his/her living expenses during the pendency of the matter. But how are you going to do that when your income has just been slashed and your expenses just doubled?

29871157 - divorce decree court dealing with division of property and custody rights of kid

Judge Jones of Ocean County recently addressed what happens when one spouse requests support of the other during the divorce proceedings, or on a pendente lite basis, under the newly enacted statutory amendments to New Jersey’s alimony statute in the recent case of Malik v. Malik.

Historically, in New Jersey, judges have awarded pendente lite support to preserve the status quo, and maintain the parties in the positions they were in prior to the litigation. This typically involves payment of the marital bills and expenses necessary to maintain the dependent spouse at the standard of living enjoyed during the course of the marriage.

The logic of these awards is clear. As Judge Jones put it in Malik: “…if there is no interim support agreement or order defining the financial rights and obligations of the parties, economic chaos may result…the purpose of a pendente lite support application is to help financially bridge the gap in time between the beginning and end (or other interim point in the divorce litigation), in an orderly fashion…In fact, a pendente lite order is often the only way to provide the means for a supported spouse to survive at the start of an action.”

Here is a general run-down of how pendente lite applications are heard and decided:

• A supported spouse files a pendente lite motion at the start or the early stages of the divorce process, asking the court to make preliminary decisions about interim support. This is typically prior to the close or perhaps even the start of the period of discovery – meaning, that the Court does not yet have complete information as to the parties’ finances.

• The motion is generally heard on the Family Court’s motion calendar.

• In deciding the application, the Court rarely takes direct oral testimony of the parties and instead is authorized to make a determination based upon affidavits of the parties.

• Any pendente lite order is entered without prejudice, meaning that it can be retroactively modified, upward or downward at the trial of trial, in the court’s discretion. The court can also modify the award prior to trial upon a showing of change circumstances.

Prior to the enactment of the new alimony law, N.J.S.A. 2A:34-23, the focus of these applications was typically the marital lifestyle, i.e. the status quo of the marriage, almost to the exclusion of all other factors.

In 2014, however, the legislature enacted amendments to the statue, which now clarify the concept of considering all of the factors in the alimony analysis rather than just marital lifestyle. In fact, 4 separate directives in the statute make that concept more clear:

(1) The amended statute now directs family courts to consider, among other factors, “the practical impact of the parties’ need for separate residences and the attendant increase in living expenses on the ability of both parties to maintain a standard of living reasonably comparable to the standard of living reasonably comparable to the standard of living reasonably comparable to the standard of living in the marriage or civil union to which both parties are entitled.”

(2) The amended statute expressly provides that neither party has “a greater entitlement to that standard of living than the other.”

(3) The amended statute declares that “no factor shall carry more weight than any other factor unless the court finds otherwise.”

(4) The amended statute now states that the nature, amount and length of pendente lite support, if any, paid during the divorce proceeding is to be considered by the court when rendering a final alimony award.

Judge Jones applied these principles to the Malik case where the “blunt economic reality” of separation and divorce rendered it impossible for either party to financially maintain the prior marital lifestyle, or the same standard of living to which they formerly became accustomed during the marriage.

In the Malik case, the husband was a teacher earning $90,000 per year, while the wife was a hairdresser with an imputed income of $20,000 per year. In 2016, each party filed for divorce. They are living separately, and have been sharing joint legal and residential custody of their 2 children.

The wife filed a motion seeking pendente lite alimony which she contended that she needed alimony in order to maintain the marital lifestyle and standard of living, which she had not been able to maintain at the same level as the husband, because he was not paying support. The husband disputed the wife’s need for alimony because she had moved in with her mother.

When Judge Jones examined the evidence in this case, he concluded that the parties’ marital lifestyle budget was $6,100 per month. With the husband remaining in the former marital residence, that of course meant that there was not enough money for both parties to maintain the same lifestyle living apart that they were able to afford while living together. It was simple mathematics, the judge concluded.

Judge Jones went on to state that when neither party can afford to separately maintain the marital lifestyle after separation, both parties should be required to adapt to lifestyles which are financially lower than that which they enjoyed together. A separation constitutes a substantial change in circumstance which requires an appropriate adjustment to the status quo of the marriage. Put another way, no matter what a married couple’s prior married lifestyle and status quo may have been, a separation by married partners into two separate homes is sometimes as substantial a change of economic circumstances as on can possibly imagine.

While the judge certainly took into account both parties’ economic realities, he stated that he would not discount the wife’s need for support based upon her residence with her mother which “appears to be…of financial necessity.” He stated that denying alimony because limited financial circumstances required the wife to move back in with her mother would be “the height of irony.” Even without roof expenses, the wife still had reasonable needs.

Considering all the applicable statutory factors, under the totality of the circumstances, Judge Jones ordered that the husband pay the wife $350 per week in pendente lite alimony, which he noted may be considered “too high” by the husband and “too low” by the wife. But, he noted, it certainly could not be considered inequitable under all the circumstances.
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Eliana Baer, Associate, Fox Rothschild LLPEliana Baer, Associate, Fox Rothschild LLP Eliana T. Baer is a contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

As avid readers of this blog know, New Jersey’s recently amended alimony statute has been the inspiration for many blogs posts as cases interpreting same are coming down the pike. Under the amended statute, a party may seek to terminate or modify his or her spousal support obligation based upon an actual or “prospective” retirement. While this was seemingly good news for those seeking to retire, the question many practitioners had was what does “prospective” actually mean?

In the case of Mueller v. Mueller, Judge Lawrence Jones provides some insight as to this very question. The facts in Mueller are simple. The parties were married for twenty (20) years, divorcing in 2006. Under the parties’ Marital Settlement Agreement, the obligor was to pay $300.00 per week in permanent alimony and their agreement did not expressly address retirement or its relationship to the alimony obligation.

The obligor filed a post-judgment motion, under New Jersey’s amended alimony law, seeking a determination that his alimony would end in five (5) years. At the time of the hearing, the obligor was 57 years old. In five years, he would be 62 and entitled to receive his full employment-related pension benefit. The obligor asserted that if his alimony does not end at that time, that he will be unable to retirement at that age.

Judge Jones provides a thorough analysis of the obligor’s claim, specifically discussing the distinction of a pre-September 2014 agreement modification/termination analysis (where the burden is on the obligor to demonstrate why alimony should terminate) vs. a post-September agreement modification/termination analysis (where there is a rebuttable presumption of termination with the burden on the recipient).

He also notes that the amended statute covers the situation where an obligor wishes to retire earlier than “full retirement age” as defined by the receipt of full social security benefits”, which in this particular case would be 66 years and 8 months for the obligor. The rationale behind this provision is to avoid the proverbial “Catch-22” financial situation.

Specifically, if an obligor is considering the possibility of retirement in the near future, he or she logically benefits from knowing in advance, before making the decision to actually leave the workforce, whether the existing alimony obligation will or will not change following retirement. Otherwise, if the obligor first retires and unilaterally terminates his or her primary significant stream of income before knowing whether the alimony obligation will end or change, then the obligor may find him/herself in a precarious financial position following such voluntary departure from employment if the court does not terminate or significantly reduce the existing alimony obligation.

When applying the new law to the facts of the Mueller case, Judge Jones held:
• The spirit of the statute inherently contemplates that the prospective retirement will take effect within reasonable proximity to the application itself, rather than several years in advance.
o Thus, in this specific case, the request for an order prospectively terminating alimony five (5) years in advance does not lend itself to the Court being able to reasonably analyze and consider all relevant information. The Court warns about how an application too far in advance of prospective retirement could in essence be nothing more than an attempt to summarily change the terms of an alimony settlement agreement.

• An order for prospective termination or modification of alimony based upon reaching a certain retirement age inherently contemplates that the obligor not only reaches retirement age, but actually retires at that point. If the obligor reaches the age, but does not actually retire, the “retirement age” provisions do not trigger until such time as the obligor actually retires or submits an application regarding a prospective retirement in the future.

o Here, the obligor did not provide a specific plan but merely stated a desire to potentially retire in five (5) years, without anything more. While this case does not create a bright-line for when such applications should be brought, Judge Jones notes that a prospective retirement application brought, 12-18 months before prospective retirement, may be more appropriate.

The takeaway from this case is that while the amended alimony statute permits a degree of reasonable prospective adjudication by the court for a prospective rather than actual retirement, an attempt to engage in the necessary statutory analysis several years in advance of such retirement would likely be replete with long-term guesswork. Any such effort would essentially ignore the practical reality that the parties’ economic situations, health and other relevant factors may radically change over such a lengthy period of time, before an actual retirement ever takes place. If you are paying alimony and are within 12-18 months of retirement, you should think about consulting with an experienced professional to discuss your options regarding the termination or modification of your alimony obligation.

I’m not usually one to place a lot of stock in celebrity gossip, but I couldn’t help but take notice of the fact that it has been rumored that Amber Heard’s monthly income is $10,000, yet she spends $44,000 a month on shopping, dining out and vacations. Her ask for spousal support: $50,000 per month, based upon the parties’ marital lifestyle.

45351836 - champagne bottle in ice bucket and two full glasses realistic vector illustration
45351836 – champagne bottle in ice bucket and two full glasses realistic vector illustration

Amber Heard may not be only one spending beyond her means. This phenomenon applies to us common folk as well.

Particularly during the economic downturn, we have seen many cases where parties have splurged during times of plenty and then failed to scale back when the economic downturn hit. As a result, the parties are living on credit or perhaps not paying their bills. It, in effect, creates an artificial lifestyle which neither party really has the ability to maintain.

This puts the Court in a tough spot. On the one hand, the Supreme Court explained in Crews, “the standard of living experienced during the marriage . . . serves as the touchstone for the initial alimony award.” On the other hand, what happens when the marital standard of living is based on nothing more than irresponsible spending?

An unpublished case was just recently decided by the Appellate Division that touched on this issue. Although the crux of the case really focused on the reversal of a judge’s suspension of alimony as a discovery sanction, what peaked my interest was how the judge dealt with what he classified as an “artificial lifestyle,” marked by the parties’ “irresponsible spending and outlandish behavior, whether going on expensive vacations to South America and Europe, or purchasing fancy cars” when awarding alimony.

In Ponzetto v. Barbetti, decided on June 28, 2016, the parties had a nineteen year marriage which ended in a contentious divorce when the parties were in their mid-forties. The parties did not have any children and the only issues in the case were equitable distribution and alimony, both of which were hotly litigated during the course of a lengthy trial.

The husband had started a sound system business when he was a teenager, for which the wife kept the books. At one point, the business was so lucrative, that it generated revenue of $500,000 per year. These were the times of plenty.

Unfortunately, the business suffered during the economic downturn. The parties’ lifestyle, however, did not. They continued to spend lavishly. By the time of the divorce, they had two Ferraris, a Harley Davidson, Pontiac Fiero and two hummers.

While typically a judge would look at the parties’ spending during the last several years of the marriage to determine lifestyle, in this case, the trial judge found that it would not be appropriate to do so in this situation, where the lifestyle was not based on income or need.

As a result, the judge declined to use “the parties’ irresponsible spending from 2006 through 2008 in determining marital lifestyle” and instead determined to “kindly” utilize the marital lifestyle from 1990 through 2006, which the judge determined to be $14,500 per month. Ultimately, the wife was awarded $400 per week in alimony.

This is just one example of how a judge has dealt with this increasingly common situation. However, judges are frequently placed in these precarious situations, where the parties have exceeded a reasonable lifestyle based upon their income as compared to their expenses. In the case of Ponzetto v. Barbetti, the judge crafted a remedy that was equitable given the specific circumstances of the case.
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Eliana Baer, Associate, Fox Rothschild LLPEliana T. Baer is a contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

If I’ve heard it once, I’ve heard it a million times: “why don’t judges enforce their own orders or take hard lines against obstructers?” Many times, litigants feel powerless. Powerless to change anything; powerless to have courts take a firm position in favor of those aggrieved; and, powerless to be heard. Clients and attorneys alike feel this frustration.

This is despite the fact that there are specific rules in New Jersey that apply to non-compliance in the family part. Rule 5:3-7 provides for very specific types of relief in specific actions:

Non-Compliance with Custody or Parenting Time Orders:

(1) compensatory time with the children;
(2) economic sanctions, including but not limited to the award of monetary compensation for the costs resulting from a parents failure to appear for scheduled parenting time or visitation such as child care expenses incurred by the other parent;
(3) modification of transportation arrangements;
(4) pick-up and return of the children in a public place;
(5) counseling for the children or parents or any of them at the expense of the parent in violation of the order;
(6) temporary or permanent modification of the custodial arrangement provided such relief is in the best interest of the children;
(7) participation by the parent in violation of the order in an approved community service program;
(8) incarceration, with or without work release;
(9) issuance of a warrant to be executed upon the further violation of the judgment or order; and
(10) any other appropriate equitable remedy.

Non-Compliance with Alimony or Child Support Orders:

(1) fixing the amount of arrearages and entering a judgment upon which interest accrues;
(2) requiring payment of arrearages on a periodic basis;
(3) suspension of an occupational license or drivers license consistent with law;
(4) economic sanctions;
(5) participation by the party in violation of the order in an approved community service program;
(6) incarceration, with or without work release;
(7) issuance of a warrant to be executed upon the further violation of the judgment or order; and
(8) any other appropriate equitable remedy.

27249354 - symbol of sanctions as a clamps

In other words, with most family part actions, the sky is the limit in terms of what remedies can be utilized to secure compliance. Moreover, in other instances of non-compliance not covered by the family part rules, for instance, filing frivolous motions to harass the other party, or failing to make discovery, other rules apply that should serve to get a litigant to do the right thing.

So why the disconnect?

Well, it appears that some judges are beginning to take a hard stance against people who just feel like marching to the beat of their own drums, people without any regard for Orders of the Court, or resultant victimization to the other party.

For example, in August, a New Jersey couple was hit with a $543,000 sanction by a Manhattan judge for interfering with their son’s divorce. Justice Ellen Gesmer said that the couple “orchestrated the litigation” between their son and his wife, caused extensive delays, and launched a legal battle designed to “intimidate” their daughter in law.

The parties were married in 2005, and had one child in 2007. Tragically, the husband suffered a brain aneurysm in 2008, rendering him disabled. The wife initially cared for the husband, but was ultimately pushed out of the picture by his parents, who actually took him to a facility and hid him from the wife for several months in 2009.

When the divorce was filed in 2010, the grandparents ran the show on behalf of the son, and directed the son’s lawyers to delay the custody hearing for as long as possible so that they could pursue 50% custody of their grandchild, based upon the pretense that it was on their son’s behalf. By the end of the litigation, the wife’s legal bills were in excess of $928,000.

The judge ultimately found that the parents “willfully interfered with (their granddaughter’s) development of a positive and loving relationship with her father…(and) purposefully engaged in frivolous litigation.”

The judge also came down hard on the father’s lawyers, ruling that they engaged “in frivolous conduct by repeatedly making misrepresentations and knowingly false statements and claims to the court.” She ordered the lawyers to contribute $317,480.67 toward the wife’s legal bills.
The in-laws were ordered to pay, in total, a whopping $543,000.

Back on the other side of the river, in a recent Somerset County case, two opposing litigants were both ordered to perform community service for what the judge found was their willful non-compliance with their marital settlement agreement. The judge also warned them that they were to comply or face the possibility of sanctions.

It appears that judges are “getting real” about compliance. Whether it means the imposition of counsel fees against an overly litigious party or community service, a more clear message is being sent by these judges that non-compliance will not be tolerated.
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Eliana Baer, Associate, Fox Rothschild LLP Eliana T. Baer is a contributor to the New Jersey Family Legal Blog and a member of the Family Law Practice Group of Fox Rothschild LLP. Eliana practices in Fox Rothschild’s Princeton, New Jersey office and focuses her state-wide practice on representing clients on issues relating to divorce, equitable distribution, support, custody, adoption, domestic violence, premarital agreements and Appellate Practice. You can reach Eliana at (609) 895-3344, or etbaer@foxrothschild.com.

Too often in family law practice, the discovery process by which one litigant is supposed to procure information from the other litigant becomes a frustrating and costly game where the non-compliant party hopes that the other party will simply give up rather than continue the chase down the rabbit hole of information.  Long-term readers of this blog may, in fact, remember Eric Solotoff’s post about the Discovery Dance, where parties can, in fact, “dance if they want to and leave their friends behind”.  Information is deliberately withheld, or incomplete, or ignored, etc.   As opposed to standard civil litigation, however, it often seems that a non-compliant litigant does not pay the price for such misconduct.  While perhaps this simply goes along with family law’s often mis-characterized “Wild West” reputation, what is one party who simply can’t get information from the other party to do when discovery motions are commonly frowned upon as a waste of the court’s limited resources?

Hide and seek

This is especially true in cases where one party seeks to modify an alimony or child support obligation.  Trying to get the full financial picture, especially from the party seeking the modification, is often the most difficult challenge of litigating such a matter.  It often becomes even more difficult in cases where either party is remarried and the new spouse has assets, income and the like that the remarried litigant does everything he or she can to shield from the court’s consideration.  This becomes a problem when one party is, perhaps, providing the new spouse with money to hold in a separate account, or the house is solely in the new spouse’s name, and the like.  In other words, the financial picture can be manipulated a dozen different ways and roadblocks structured so that the court never has all of the relevant facts and circumstances upon which to render a determination.

In Null v. Null, a recently unpublished (not precedential) decision from the Appellate Division, an ex-husband’s application seeking a termination of his alimony obligation was dismissed – with prejudice – because of his repeated refusals to comply with discovery requests and related court orders.  Here is a brief recitation of the relevant facts:

  • After a lengthy post-judgment procedural history wherein the payor sought to terminate his alimony obligation, the court – in November 2010 – found that he had made an initial showing of “changed circumstances” sufficient to warrant a plenary hearing on his motion to reduce alimony.  Notably, payee claimed that payor had entirely stopped making alimony payments at that point.
  • The judge directed that payor produce certain forms of discovery including, but not limited to, his current wife’s most recent three pay stubs.  Payor objected, moving to bar discovery of his new wife’s assets.  The motion was denied because payor was claiming to be employed by a business owned by new wife, and payee claimed that payor had placed businesses and assets he owned in new wife’s name.
  • Payor subsequently moved again to block discovery of his new wife’s financial information and was denied.  Payor was ordered to pay counsel fees – the first of many consequences to the payor for his misconduct.  New wife was also ordered to sit for her deposition.
  • At her deposition, new wife failed to produce tax returns or pay stubs as previously ordered.  She also failed to produce documents relating to the dry cleaning business payee claimed was owned by her.
  • With scheduled trial dates having come and gone, and payor still having failed to comply with discovery, the trial court denied payor’s motion to depose payee and compel her to undergo an employability evaluation.  In so doing, the judge noted that payor took no issue with violating discovery orders, and “unreasonably delayed” payee’s ability to effectuate litigation.  Counsel fees were again awarded for payee.
  • In October 2013 – three years after the initial changed circumstances burden was fulfilled – a third trial judge entered an order rescheduling the plenary hearing, and appointing an expert to examine businesses allegedly owned by new wife and operated by payor.  Payee was permitted to depose new wife as to whether payor maintained an equitable ownership of the businesses registered to new wife.  Payee was again awarded counsel fees for a third time.  Payor sought reconsideration and a stay of the October 2013 orders.
  • On April 3, 2014, the trial judge dismissed payor’s motions to modify alimony – with prejudice – pursuant to Rule 4:23-2(b) based on payor’s “failure to cooperate with the court’s expert, his failure to file complete Case Information Statements, and his extensive history of failure to timely respond to [payee’s] discovery requests and comply with court orders.”  Payor was also ordered to resume alimony payments at $6,000 per month, and to pay $201,000 in alimony arrears from November 2010 (when the hearing was first scheduled) through March 2014.

While noting that dismissing an action “with prejudice” (a final determination on the merits of the case that precludes further litigation of the matter) because of a party’s failure to comply with discovery is a drastic sanction “generally not to be invoked except in those cases in which the order for discovery goes to the very foundation of the cause of action, or where the refusal to comply is deliberate and contumacious,” the Appellate Division affirmed the trial court’s decision to do so in this case.

In so doing, the Court analyzed the differences between Rules 4:23-2 and 4:23-5 of the New Jersey Court Rules because payor argued that the trial court engaged in an abuse of discretion under 4:23-5 by failing to first dismiss the case “without prejudice” (a dismissal without a decision on the merits that leaves the parties able to litigate the matter in a subsequent action) and then only dismissing “with prejudice” if he failed to thereafter comply.  Disagreeing with payor, the Appellate Court found that while 4:23-5 does, in fact, require the initial without prejudice dismissal, 4:23-2 does not.

Here, payor even acknowledged that he had not been compliant with all discovery demands made, and his position that he and his new wife had provided timely and relevant information was unsupported by the record.  After more than five years of continuous litigation, there was still no clear picture of payor’s earnings, and the trial court found that his “willful and deliberate violations of court orders across a period of more than five years justified dismissal.”  Five years of delay.  At least ten court orders directing payor to provide payee with discovery to which she was entitled.  Still no end in sight.

The Appellate Division concluded, in light of such facts:

  • “[T]he trial court reasonably concluded that it was unfair to plaintiff to be interminably delayed in resolving the alimony dispute.”
  • “Because the judge’s decision was prompted by defendant’s blatant and continuous defiance of several court orders, we perceive no abuse of discretion in her decision to dismiss defendant’s claim with prejudice.”

While there will always be litigants who believe that the discovery rules and obligations are not worth more than the paper on which they are written with the belief that playing games will provide the optimal result, the trial court’s implementation of available sanctions shows that, at least in some cases, there is a price to pay for such non-compliance.

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Robert A. EpsteinRobert Epstein is a partner in Fox Rothschild LLP’s Family Law Practice Group and practices throughout New Jersey.  He can be reached at (973) 994-7526, or repstein@foxrothschild.com.

Connect with Robert: Twitter_64 Linkedin

*image courtesy of Stuart Miles.

As regular readers of this blog may know, cohabitation has been a hot topic of discussion in recent months with several new cases addressing the subject within and beyond the context of the amended alimony law.  With new case law to consume, one question remains constant – how does a payor spouse fulfill his or her initial burden of proving cohabitation so as to justify a period of discovery and a future hearing as to how and whether alimony should be modified (or suspended, or terminated, etc.).

threes company

In Robitzski v. Robitzki, another recently issued cohabitation decision from the Appellate Division, the Court affirmed the lower court’s findings that the ex-husband/payor spouse failed to present sufficient evidence of a prima facie claim of cohabitation.  Here are the facts that you need to know:

  • The parties were divorced in 2004.  The property settlement agreement required that the ex-husband pay the ex-wife $2,500 in monthly permanent alimony.
  • The agreement also provided that alimony “shall be modified or terminated pursuant to New Jersey statutes and case law” in the event it was proven that the ex-wife was cohabiting with another.  The PSA did not define cohabitation, nor did it specify whether applicable “New Jersey statutes and case law” to be analyzed in such a claim would be those existing at the time of the divorce or those existing if and when the ex-husband filed a motion to address the issue.
  • From the time of the divorce through the subject motion practice, the ex-wife admittedly maintained a lengthy relationship with a significant other.
  • The ex-husband filed his motion after the alimony law was amended in late 2014.  He claimed that the parties were cohabiting under the amended law.
  • The ex-wife cross-moved for a declaration that the 2014 amendments did not apply to the alimony obligation at issue.
  • In support of his motion, wherein the ex-husband claimed the ex-wife and significant other were interdependent upon each other, he claimed that they held themselves out as the “equivalent” of spouses, and provided various items posted publicly on Facebook by the significant other containing photos and commentary of various family and social activities that the significant other engaged in with the ex-wife and her children.  The children referred to the significant other as “Pap Thom.”
  • In opposing the motion, the ex-wife certified that the significant other only spent approximately 100 nights out of the year overnight with her, and they maintained separate finances and assets.  She provided copies of bank statements and bills for 2013 and most of 2014 showing the ex-wife paid her bills from her bank account balances, and that there were no deposits from any unaccounted for sources.
  • The trial judge denied the ex-husband’s motion, finding that he failed to provide proof of financial interdependency, and the court did not consider the Facebook postings (which the judge deemed inadmissible hearsay and substantially unauthenticated).  The judge also denied application of the amended law to the present matter.
  • Notably, however, limited discovery was granted ordering the significant other to provide a certification addressing his independent living arrangements – including the length of his lease or whether he owns the home, whether he and the ex-wife are co-owners or co-tenants, and whether he lives alone and how he pays for his current living arrangements.  The judge also ordered the ex-wife to provide an accounting of her household expenses, including how such expenses were paid for in 2012.

In addressing whether the amended law or pre-amended law applied, the court declined to resolve the issue for multiple reasons including that the settlement agreement language was ambiguous as to what law should apply.  In language that practitioners thirst for, even if an unreported (not precedential) decision, the Court notably provided:

          We recognize that the new statute eliminates the modification of alimony as a remedial alternative to termination or suspension upon a finding of cohabitation.

This language will surely provide some degree of guidance, although it is not likely the end of what we will hear about whether modification can still occur.

Ultimately, the court held that whether the new or old law applied, the ex-husband still failed to fulfill his initial burden.  The reasoning was as follows:

  • The ex-wife attested to spending essentially a weekend of overnights each week with the significant other – “far less than the majority of days of the year.”  In so doing, the court noted:

          Although we do not treat the frequency of overnights as a dispositive “litmus test” for cohabitation, (and are mindful that subsection (n) of the new statute, if it applied, expressly disallows such per se reasoning) their infrequency here is certainly a significant consideration that bolsters the trial court’s conclusion that a prima facie case has not been presented.

  • The Court acknowledged that the Facebook postings reflected that “he and the ex-wife take part with one another in a variety of social and family activities, go on vacations together, and attend graduation ceremonies, family gatherings and other such events together.”  The Court noted, however, the postings – even had they been considered by the trial court – were not enough.
  • The Court, added, however, “Even so, the present record lacks any evidence that the couple’s finances are intertwined or that the ex-wife is financially dependent upon the significant other.”  No proof of joint bank accounts or other joint asset holdings or liabilities.  No proof of shared living expenses.  No proof of any enforceable promise of support.  Little proof of shared household chores with “the exception of occasional snow removal”.  Notable, however, is the level of potential difficulty in the ex-husband establishing financial inter-dependency on his initial motion without discovery beyond the limited documents provided by the ex-wife.
  • Concluding its opinion, the Court commented that the ex-husband could make a future application with supplemental proofs that the couple resides together more frequently, or that their lives and finances are “actually more intertwined than what the present record suggest[ed].

Robitzski presents an interesting dilemma for practitioners and litigants looking to fulfill the initial burden of proof associated with a cohabitation claim.  How much is enough?  What is enough?  Every judge will look at the case differently.  Each case has its own set of facts where one component may weigh more heavily than another.  Only time will tell if a valid claim has been raised.

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Robert A. EpsteinRobert Epstein is a partner in Fox Rothschild LLP’s Family Law Practice Group and practices throughout New Jersey.  He can be reached at (973) 994-7526, or repstein@foxrothschild.com.

Connect with Robert: Twitter_64 Linkedin

*image courtesy of Google free images.

The amended alimony law that went into effect in late 2014 raised many questions as to the meaning of its terms and how such terms will be applied, especially as to how a payor’s retirement impacts upon an existing alimony obligation.  As we have previously discussed, the law provides that a payor former spouse may even file an application to terminate or modify alimony based on a future, prospective retirement, at which point a court may establish under what conditions same should occur.  So doing allows the payor and payee to plan accordingly by providing an indication as to whether and how alimony will end/change.

Golfer

This was the topic addressed in Mueller v. Mueller, a new unpublished (not precedential) decision from the Honorable Lawrence Jones in the Ocean County Family Part.  Judge Jones held as follows:

  1. While the amended alimony law does not set a specific minimum or maximum time period for obtaining an advance ruling on a prospective retirement and its effect upon an existing support obligation, Judge Jones concluded that the statute contemplates that the prospective retirement will take effect “within reasonable proximity” to the application itself, rather than several years in advance.  Notably, the judge referenced “approximately twelve to eighteen months” as an appropriate proximity.  Otherwise, the application is more akin to a motion to modify a permanent alimony obligation to one of limited duration without a basis under Rule 4:50-1 or the requisite change in circumstances.
  2. As a result, the payor’s application to terminate alimony based on a prospective retirement date to occur five years later was not considered within a reasonable proximity because “reasonably current information” relative to the time period of the proposed retirement itself could not be considered.
  3. An order for prospective termination or modification of alimony based upon reaching a certain retirement age “inherently contemplates” that the obligor reaches a specific age and actually retires at that point.  A specifically detailed proposed plan for an actual retirement must be provided, as opposed to a “non-specific, general desire to someday retire.”  The specifics may include, but are not limited to, a particular retirement date, and details of the payor’s plan for economic self-support following retirement.

Here are the facts that you need to know:

  • The parties were married in 1986 and divorced in 2006.
  • The settlement agreement provided that husband would pay wife $300 per week in permanent alimony.
  • The agreement contained no provision expressly addressing retirement and/or its relationship to husband’s permanent alimony obligation.
  • Husband filed a motion under the amended alimony statute to terminate his alimony in five years from the date of his application, asserting that he was 57 years old and planed to retire in five years (at which time he was entitled to retire and receive his full employment-related pension benefit).

Analyzing the relevant facts, the court found the husband failed to provide a specific plan to retire in the near future, and that he was nowhere near even an early retirement age.  Rather, he testified about a “general wish to potentially retire and terminate alimony at age 62 . . . .”  Filing so far in advance was found to preclude the court from engaging in a practical analysis of the parties’ economic circumstances that would exist at the time of the termination/change, the parties’ health and other relevant factors that could dramatically change before the retirement ever occurred.  As a result, the husband’s application was denied without prejudice based on his request to retire five years later.

Decisions addressing the provisions of the amended alimony law continue to emerge, and Judge Jones’ decision makes practical and logical sense when considering the retirement provisions and a payor’s ability to seek a termination/modification in light of a future, anticipated retirement date.  The decision will help both litigants and practitioners in framing future applications and oppositions for such relief

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Robert A. EpsteinRobert Epstein is a partner in Fox Rothschild LLP’s Family Law Practice Group and practices throughout New Jersey.  He can be reached at (973) 994-7526, or repstein@foxrothschild.com.

Connect with Robert: Twitter_64 Linkedin

*image courtesy of Google free images.

The impact of cohabitation on alimony is often one of the most difficult clauses to negotiate in a marital settlement agreement.  The payor always wants the agreement to read that alimony shall terminate upon cohabitation, while the recipient, if they are allowed to agree to anything, might agree to allow the payor to seek to modify alimony “in accordance with the law”.  Generally, “the law” would be an economic benefits test – i.e. is the alimony recipient receiving an economic benefit by virtue of the cohabitation and/or is she providing one to her cohabitant.

That said, at least since 1999, when the Konzelman case came was decided by the Supreme Court, that agreements to terminate alimony based upon cohabitation are enforceable if cohabitation is proven and the “the cohabitation provision of the marital settlement agreement [sic] was voluntary, knowing and consensual.”

17790572_s

But what happens in a case with a clear cohabitation clause requiring termination, where the cohabitation ends, perhaps because of the litigation, or simply because the relationship ran its course?  Should the alimony recipient be entitled to start receiving alimony again?  Today, the Supreme Court answered that question in the negative in the case of Quinn v. Quinn.  Put another way, the law is now clear that if you have a termination clause and you cohabit, alimony is over, even if the cohabitation ends.

In Quinn, the parties divorced in 2006 after a 23 year marriage.  Per their Property Settlement Agreement (PSA), the wife was to receive permanent alimony of approximately $68,000 per year plus Cost of Living Increases.  The PSA stated that “alimony shall terminate upon the Wife’s death, the Husband’s death, the Wife’s remarriage, or the Wife’s cohabitation, per case or statutory law, whichever event shall first occur.”  The wife started cohabiting in January 2008.  The cohabitation included all of the usual indicia of cohabitation – including the fact that the cohabitant maintained his own home – apparently for appearances only.  PRACTICE NOTE:   Finally a case that seemingly looks past the fiction of a separate residence that the cohabitant has access to but really doesn’t live at.

About a month after the motion to terminate alimony was filed, the cohabitation allegedly ended.  Though cohabitation was found to occur, the trial court’s decision deviated from the PSA.  Specifically,

Having determined that Cathleen and Warholak had cohabited, the trial court invoked its equitable powers and suspended alimony for the period of cohabitation — from January 2008 until April 2010 — but declined to terminate alimony permanently. The trial court based its decision on the great difference in incomes between Cathleen and David, concluding that Cathleen was “entirely dependent on her alimony for her support.”

 

However, because the court found her not credible in her testimony, that she had litigated in bad faith, and that she had falsely denied cohabitation, the payor was awarded $145,536.74 in legal fees.  Both parties appealed but the Appellate Division affirmed.  Both parties sought Certification from the Supreme Court but only the payer’s Petition was granted on the issue of “whether the trial court properly invoked its equitable power to modify the clear and unequivocal terms of a PSA entered knowingly and voluntarily by both parties.”

The Supreme Court reversed deciding:

In sum, we reiterate today that an agreement to terminate alimony upon cohabitation entered by fully informed parties, represented by independent counsel, and without any evidence of overreaching, fraud, or coercion is enforceable. It is irrelevant that the cohabitation ceased during trial when that relationship had existed for a considerable period of time. Under those circumstances, when a judge finds that the spouse receiving alimony has cohabited, the obligor spouse is entitled to full enforcement of the parties’ agreement. When a court alters an agreement in the absence of a compelling reason, the court eviscerates the certitude the parties thought they had secured, and in the long run undermines this Court’s preference for settlement of all, including marital, disputes. Here, there were no compelling reasons to depart from the clear, unambiguous, and mutually understood terms of the PSA. We therefore reverse the judgment of the Appellate Division.

In noting that Courts have greater discretion in interpreting marital agreements, the Supreme Court reiterated that, “An agreement that resolves a matrimonial dispute is no less a contract than an agreement to resolve a business dispute.”  Of course, the court failed to correlate this statement with the famous quote from the landmark Lepis case that “contract principles has no place in the law of domestic relations” but I digress.

The Supreme Court was clear to point out that this case was decided based upon the law in effect at the time of the Agreement, not the 2014 amendments to the alimony statute.  It bears repeating that under the new statute, alimony may be suspended or terminated if there is cohabitation.

In equating this to remarriage, the Supreme Court noted:

Furthermore, Cathleen continued to cohabit with Warholak after David filed the motion to terminate alimony and still cohabited with him when the trial commenced. This record presents a situation no different from a remarriage that terminates by death or divorce. In light of the parties’ agreement that alimony would terminate upon cohabitation, the circumstances here do not call for a different result.

The Supreme Court rejected the notion that this type of provision allows a payor to control the alimony recipient, holding:

Finally, we reject the suggestion that enforcement of this cohabitation agreement permits a former spouse to control the post-marital conduct of the other spouse. Such a contention misconstrues the purpose of identifying cohabitation as an alimony-termination event and also misconstrues this record. When parties to a matrimonial settlement agreement have agreed to permit termination of alimony on remarriage or cohabitation, they have recognized that each are equivalent events. In each situation the couple has formed an enduring and committed relationship. In each situation, the couple has combined forces to mutually comfort and assist the other. The only distinction between remarriage and cohabitation is a license and the recitation of vows in the presence of others. When the facts support no conclusion other than that the relationship has all the hallmarks of a marriage, the lack of official recognition offers no principled basis to treat cohabitation differently from remarriage as an alimony-terminating event.

We do not today suggest that a romantic relationship between an alimony recipient and another, characterized by regular meetings, participation in mutually appreciated activities, and some overnight stays in the home of one or the other, rises to the level of cohabitation. We agree that this level of control over a former spouse would be unwarranted and might violate the no-obligation clause found in many divorce agreements.  However, the romantic relationship described above is not the long-term relationship presented in this voluminous record.

Finally, this case is unusual in that Justice Albin filed a strong dissent (which will be the subject of a separate post on this blog), about the harsh result on the recipient here.  The majority responded:

Our dissenting colleagues highlight the financial consequences of this decision to Cathleen. To be sure, those consequences are serious. Yet the record demonstrates that she knew that cohabitation would risk the loss of her primary source of income and, recognizing the consequences, she proceeded to cohabit with Warholak. She, not the Court or her former husband, exacerbated her financial situation by quitting her job and fashioning a defense that was found baseless by the trial court.  (Emphasis added)

In rejecting the dissent’s feeling that an economic benefit test should always be applied, the majority noted:

We also cannot subscribe to the view advanced by our dissenting colleagues that applying the Gayet economic reliance or dependence rule is somehow less intrusive in the personal life of the former spouse. There are few exercises more intrusive than the need to identify every expenditure and the source of the funds for each expenditure. Such an inquiry reveals a vast amount of personal information about the daily life of the former spouse that is of no concern to the obligor spouse. Moreover, sixteen years ago in Konzelman, this Court declined to import the Gayet economic dependence or reliance rule when the parties have agreed in a marital settlement agreement that cohabitation is an alimony-termination event. We discern no basis to depart from that determination. (Emphasis added)

In the past, and maybe even currently, far too many cases settled with vague language requiring termination in accordance with the law – without setting forth which law.  Quinn evidences that that was a dangerous practice for the recipient.

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Eric SolotoffEric 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 and Morristown, New Jersey offices though he practices throughout New Jersey. You can reach Eric at (973)994-7501, or esolotoff@foxrothschild.com. Connect with Eric: Twitter_64 Linkedin

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