In a recent New Jersey alimony case, a father appealed from three post-judgment orders requiring him to pay additional alimony and additional child support from 2010-2013 in line with a marital settlement agreement. The couple had divorced in 2010 after a marriage that lasted 15 years and resulted in two kids, who were teens at the time of divorce.
The parties were divorced in 2010 after 15 years of marriage and two children, both now teenagers. The father was a high-earning specialist in financial services. He’d been laid off but also gotten hired again at the same or higher level of compensation. The mother was a product manager earning more than $80,000 by the end of the marriage.
The mother and father were represented by attorneys during the divorce, and the attorneys had negotiated the marital settlement agreement, which was more than 30 pages long. There were 10 paragraphs about alimony and child support. These included a provision in which the husband would pay base child support for the calendar year and also pay additional child support of 8% from the gross amount of the bonus, incentive award, deferred compensation, or other form of compensation until the kids were emancipated.
If the husband got any bonuses, incentives, or other forms of compensation, he was required to pay child support on that amount. In addition to a base alimony payment, the husband also had to pay additional sums if he were paid bonuses, incentives, deferred compensation, or other forms of compensation.
The divorce judgment was entered in 2010, and the father was laid off the next year. He got a certain amount of severance pay and was reemployed and then laid off again. He again received severance. This cycle repeated a few times, but he was unemployed at the time the orders being appealed were entered in late 2015 and early 2016.
The father owed additional alimony under the agreement only if the severance payments were treated as compensation. The father argued that the severance was actually damages arising out of his termination and was not compensation under New Jersey law. In his view, severance pay was a look back form of payment.
The trial judge rejected the father’s arguments and his request for a plenary hearing. The lower court had explained that looking at the plain language of the marital settlement agreement, severance pay would be considered income for the purposes of an alimony calculation. The trial judge noted that the agreement had excluded the signing bonus. The severance pay was supposed to be replacement income rather than damages. The trial judge found that the agreement was negotiated to try to stop the defendant from manipulating his income and construing it as something else.
The appellate court agreed with the lower court that the language of the settlement agreement was clean and unambiguous, which meant it wasn’t necessary to conduct a plenary hearing. The requirement of additional alimony had to be calculated based on what he had to report as earned income in a particular year. In this case, the defendant had to pay more alimony based on what he reported on his federal tax return as adjusted gross income between $275,000 and $500,000. The lower court’s ruling was affirmed.
If you are considering a 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