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.
As we have previously noted on this blog, some of the biggest changes in the 2014 alimony reform amendments came in connection with the issue of retirement. In fact, the amendment to the alimony statute now has three different standards, one for early retirement, one for retirement at the attainment of full retirement age…
We have in the past blogged on cases which have been decided involving applications for a modification of support obligations based upon economic changes in circumstances. While the vast majority of these have been related to decreases in income due to the current economic times, there are other reasons why a request for a change might…
As a follow up to my blog post of last week, this week the Appellate Division came down with yet another cohabitation decision. The case of Pizzuti v. Proctor was decided on March 31, 2011. In Pizzuti, the wife appealed from a decision wherein the trial court terminated her former husband’s alimony obligation of $100 per week on a finding of changed circumstances based on the wife’s cohabitation with an unrelated male.
At the trial level the husband submitted a myriad of proofs that the wife was cohabitating in support of his obligation to terminate alimony. His efforts were for naught however, because the fact that she was cohabitating went completely uncontested. Indeed, in response to the husband’s allegations, the wife stated as follows: “I will spare the Court the trouble of scheduling a plenary hearing because I admit that I do cohabitate with Mr. Argenzio at his home, located [in] Ramsey, New Jersey and have been since 1999.” However, as I stated in my previous blog, proof of cohabitation is only half the battle. The next inquiry is whether, by virtue of the cohabitation, the wife was economically dependant on her new paramour. In New Jersey, the fact of economic dependence is presumed upon a showing of cohabitation, and it is incumbent the cohabitating spouse to prove otherwise.
Alimony terminates at remarriage, doesn’t it? At least that is what we have learned. In fact, there is even a statute, N.J.S.A. 2A:34-25, that says permanent or limited duration alimony terminates upon death or remarriage of the recipient. This is not the case for reimbursement or rehabilitative alimony, per the statute, absent an agreement to the contrary or good cause.
Fast forward to November 17, 2009, the date of the release of the unreported (non-precedential) Appellate Division opinion in the case of Kelly v. Arato.
In this case, the parties were married in 1985 and divorced in 2004. Their agreement called for $100 per month of alimony and $3100 per month in child support. The wife remarried 6 months after the divorce and the husband immediately stopped paying alimony. Four years later, when the husband’s attorney wrote to address college for the children, the wife raised the issue of the non-payment of alimony. After cross motion, the trial judge denied the husband’s motion to terminate alimony as well as the wife’s motion for payment of alimony arrears. Both parties appealed.
At the time of divorce proceedings, many of my clients ask if they can “lock” the other party to whatever support amount is rendered. If the person asking is going to be paying support, they are asking because they do not want to have to pay more in the future. If the person asking is going to be receiving the support, they are asking because they intend to rely upon the amount indefinitely. My response in most circumstances is that it can be done but it should only be done with great caution and only done by way of agreement. For example, while a litigant’s intent may be to “lock” the support amount because they are anticipating earning more in the future and do not wish to pay more in the future, once locked and the litigant is faced with unanticipated detrimental financial circumstances, they may be unable to obtain a decrease of their support obligation. In other words, it goes both ways – being bound to a specific number regardless of changed circumstances can be very beneficial in some circumstances and in other circumstances very disastrous.
N.J.S.A. 2A:34-23 recognizes the equitable power of the Courts of the State of New Jersey to modify alimony and support orders at any time. Specifically, N.J.S.A. 2A:34-23 states:
Pending any matrimonial action brought in this State or elsewhere, or after judgment of divorce or maintenance, whether obtained in this State or elsewhere, the Court may make such order as to the alimony or maintenance of the parties . . . as the circumstances of the parties and the nature of the case shall render fit, reasonable and just, and require reasonable security for the due observance of such orders. . . . Orders so made may be revised and altered by the court from time to time as circumstances may require.
Based upon the mandates of the statute, “alimony and support orders define only the present obligations of the former spouses.” Lepis v. Lepis, 83 N.J. 139, 146 (1980). Alimony and support obligations are always subject to judicial review and modification upon a showing of a change in circumstances. Id. A type of “‘changed circumstance” that warrants modification of a support order is an increase or decrease in the supporting spouse’s income.” Innes v. Innes, 117 N.J. 496, 504 (1990). However, what happens when the parties agree at the time of the divorce that the support provisions cannot be modified?
The Appellate Division decision discussed whether or not a non-modifiable clause (also called an “anti-Lepis” clause) is enforceable in the decision of Morris v. Morris, 263 N.J. Super. 237 (App.Div. 1993). The Morris Court did find that an anti-Lepis clause could be found unenforceable in some circumstances, although the particular anti-Lepis clause in Morriswas upheld. In Morris, the defendant husband sought a reduction in alimony payments despite an anti-Lepis clause in the alimony agreement stating that the agreement was not modifiable for any reason except for the husband’s physical disability. The husband based his request for reduction on a claim that the his annual income was $49,000 while his annual alimony payment was $35,000. The wife argued that husband kept all of the assets pursuant to the parties agreement and in exchanged for non-modifiable alimony, she agreed to a support amount of much less than the amount needed to sustain the marital standard of living. In holding that the husband was not entitled to a reduction in alimony payments, the court addressed a conflict between two chancery court decisions. In Smith v. Smith, 261 N.J. Super. 198, 199-200 (Ch. Div. 1992), the court determined that “an ‘anti- Lepis’ clause, which seeks to preclude the exercise of [the] Court’s equitable responsibility to review and, if warranted, to modify support obligations in response to changed circumstances, is contrary to the public policy of this State as reflected in its Legislative Acts and its judicial decisions.” In Finckin v. Finckin, 240 N.J. Super. 204, 206 (Ch. Div. 1990), the court concluded that public policy did not prohibit the use of an anti- Lepis clause.
Many times a Property Settlement Agreement or Judgment of Divorce will address the payment of alimony. An alimony calculation, among other factors, is calculated upon the length of the marriage, the income of the parties, the assets each will receive by way of the divorce, the age and health of the parties, and the age of children, if any, etc. The standard in New Jersey for a divorcing spouse is the ability to maintain the ‘marital standard of living’ or as close thereto as may be economically possible.
So, does permanent alimony really mean forever? The answer depends on the language in an Agreement or Judgment of Divorce. There is case law in New Jersey stating that cohabitation may be a cause to terminate alimony. However, cohabitation alone is insufficient unless the Agreement states otherwise. There also needs to be some financial benefit or economic intermingling.
Recently, the Appellate Division issued an unpublished decision in the matter of Adessa v. Adessa, A-2854-07T2, decided May 29, 2009, wherein husband filed a motion seeking to terminate his alimony obligation based upon his former wife’s cohabitation or alternatively, requesting a hearing and discovery to determine if there was an economic benefit being received by former wife as a result of her relationship.
New Jersey has upheld the long standing principle that permanent alimony awards are subject to review, modification and possibly termination based upon changed circumstances. (Lepis v. Lepis, 83 N.J. 139 (1980). However, it is not enough to paint a bleak picture of a payor’s financial circumstances in order to succeed in a downward modification or termination of alimony. The applicant must also show the Court that the financial difficulties being encountered are not temporary and/or subject to contingent circumstances. Innes v. Innes, 117 N.J. 496 (1990).
In the recent unreported Appellate Division decision of Norych v. Norych (A-2633-07T1 decided April 16, 2009), while the payor applicant provided the court with very grim descriptions of his personal financial situation and the financial affairs of his law firm, the applicant miserably failed to substantiate his professed circumstances.
In the Norych matter, the parties were divorced in 1992 and at the time of the divorce, the ex-wife received a permanent alimony award of $1,000 per month partly based on ex-husband’s law firm income of $70,000 per year and ex-wife’s income as a teacher of $25,000 per year. Ten years later, the alimony increased to $1,100 per month. In October 2007, ex-husband filed a Motion seeking to terminate his alimony obligation based upon what he characterized as two devastating and shocking events.
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.
In the September 2008 ABA Journal, there was an article entitled ‘Til Death Do Us Pay? As retired boomers head to the golf course, courts look at limits on alimony by Wendy N. Davis. Discussed in that article is alimony after long marriages when the parties are nearing retirement age. This article got me thinking…