Reducing Alimony Obligation in New Jersey

watching-time-1238392-e1500318003248In a recent, unpublished New Jersey appellate case, a husband appealed an order that denied his motion to get rid of his alimony obligation or reduce it. The order also provided that the husband had to maintain a $300,000 life insurance policy naming the wife as a beneficiary according to the couple’s Interspousal Settlement Agreement. The husband also had to pay $2000 to the wife’s attorney.

On appeal the husband argued it was improper for the trial court not to grant his request that alimony be terminated without making adequate findings under N.J.S.A. 2A:34-23j(3), and by improperly considering assets he got as part of equitable property contrary to N.J.S.A. 2A:34-23j(4). The husband also argued that due to his good faith retirement and the terms of the Interspousal Settlement Agreement, the court had made a mistake in asking to continue to maintain a $300,000 life insurance policy.

The husband also argued that the court made a mistake in awarding a counsel fee to the wife. He further argued that the court made a mistake by not conducting a plenary hearing on the issue of alimony, life insurance and counsel fees.

The couple had married in 1970, and got a divorce in 2007. At the time of their divorce, the couple had two kids, who were emancipated. They were represented by attorneys. They negotiated an agreement, which was memorialized in the Interspousal Settlement Agreement, and this agreement was incorporated in the final divorce judgment.

The couple worked full time during the marriage. When they divorced, the husband was a firefighter with a yearly salary of about $95,000. He kept a side business in construction, which required him to sometimes buy, improve or resell homes. The wife worked as a teacher and earned about $52,000 each year.

When the husband turned 65, he retired. The wife retired the following year when she turned 65. The husband’s firefighter salary was about $125,000, while the wife’s was about $63,000. The wife was diagnosed with stage four ovarian cancer that required her to get surgery and chemotherapy. She needed to take medical absences, but kept working full time as a teacher. The Interspousal Settlement Agreement required each spouse to be responsible for his or her own medical insurance, and by staying employed, the wife could keep receiving insurance through the employer. She became eligible for Medicare when she turned 65.

The husband was diagnosed with a form of bladder cancer and also required chemotherapy. The wife didn’t dispute the diagnosis, but the husband didn’t submit documentation to show it debilitated him or stopped him from working. He continued working after the diagnosis until he retired.

The agreement required the husband to pay a permanent alimony and maintain life insurance with the wife as a beneficiary as long as he kept paying alimony. Once alimony was terminated, he’d only have an insurance obligation of $225,000 until either of the two died.

The life insurance portion of the alimony would be modified in proportion to the modification. 63-years-old was the age that the couple agreed would be a good faith retirement. Once he retired he asked the court to terminate alimony and reduced the life insurance coverage, assuming it would drop automatically. The wife cross-moved asking that the insurance coverage stay at $300,000.

The court ordered the husband to keep the $300,000 coverage despite his retirement. The husband hadn’t given the court an updated Case Information Statement. He moved again after the court’s order, and the wife again cross-moved. She argued that the husband had omitted multiple things from the information he submitted including an inheritance of two properties.

The husband argued that these homes were titled to the estate, that no distributions had been made to him, and he was just the executor. At the time the couple divorced, their principal asset was the family home, worth about $700,000. It sold for $740,000. The husband bought a separate home for himself, which he improved, converted and sold for $640,000. He bought another house for $522,000. The wife moved into a condominium she bought.

The trial court found that nothing was in the agreement to indicate an automatic termination of alimony once the defendant got to age 63. The agreement simply acknowledged he would work until at least 63 as a good faith retirement.

The appellate court explained that a supporting spouse’s income earned from investments isn’t the only measure of a supporting spouse’s ability to pay alimony. N.J.S.A. 2A:34-23j(3) requires the court to consider whether the obligee was able to save adequately for retirement plus 8 other factors, including inherited property and bank accounts. The appellate court found that the evidence as a whole supported the conclusion that the defendant hadn’t made a showing of substantial, permanent change of circumstances and affirmed the lower court’s ruling.

If you are considering divorce in Bergen County, and you are concerned about your financial security, it is important to retain an experienced and aggressive alimony attorney to seek an appropriate outcome. Contact the lawyers of Leopold Law at (201) 345-5907 or through our online form. We have attorneys available who can handle all aspects of a divorce.

More Blog Posts:

New Jersey Court Considers Modification of Alimony, January 31, 2017

Negotiating Parenting Time From a Distance in New Jersey, February 7, 2017