Man’s Appeal To Terminate Alimony After He Retires Is Denied
- May 8, 2015
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In Baker v. Baker, the Defendant appealed from a 2013 Family Court Order that denied his Motion to terminate his alimony obligation. After review, the Appellate Division affirmed the decision of the Family Court. The parties in this case were married in 1975 and obtained their divorce in 1998. Their final divorce judgment incorporated a property settlement agreement (PSA) in which the Defendant agreed to pay $10,000 a month in permanent alimony to the Plaintiff. In 2005, the Defendant’s job was terminated and at the time he was fired he was earning $900,000 per year. Shortly thereafter, the Defendant got another job as the CEO of a smaller company where he expected to receive a salary of $120,000 with the potential for bonuses that would be commensurate with his previous job. However, the Defendant did not receive a salary or bonuses at this new position as the company was in dire financial straits. In 2008, the Defendant filed a Motion for a reduction in his alimony obligation. The Family Court denied his application. The Defendant appealed and while his appeal was pending he filed two additional Motions for interim relief, which the court also denied. At the time, the Plaintiff voluntarily agreed to accept a decrease to $8,000 a month in her alimony award. The Family Court held a plenary hearing on the issue in 2010 at the conclusion of which the Defendant’s alimony was temporarily reduced to $6,666 a month. The Defendant appealed this decision. In 2011, the Appellate Court affirmed the decision of the lower court. In 2012, the Defendant resigned from the company as it was allegedly about to close its doors and he immediately filed a Motion to terminate his alimony obligation. A plenary hearing was held at which both parties testified about their financial troubles and difficulties securing appropriate work. At the conclusion of the hearing the court denied the Defendant’s request. According to the court, there had been “no substantial change in circumstances since the last motion on the [d]efendant’s side of the equation” and that termination of alimony was not warranted because the Defendant voluntarily retired from his position. Moreover, when employed as his last company, the Defendant had not acted in good faith as he voluntarily went several years without receiving any income while at the same time loaning the company $138,000. Finally, the court found that instead of seeking a position that would enable him to pay alimony, the Defendant was only “interested in high paying jobs. . . .” Therefore, the court imputed $120,000 a year in income to him which was similar to what he could earn as the base salary at his previous job. The court also noted that the Defendant earned about $170,000 a year in unearned income. In the end, the court ordered the Defendant to pay $5,166 per month in alimony. He appealed. According to the Appellate Division, alimony “may be revised and altered by the court from time to time as circumstances may require.” N.J.S.A. 2A:34-23. In order to make such a modification a party must show “changed circumstances.” Lepis v. Lepis, 83 N.J. 139, 146 (1980); Weishaus v. Weishaus, 180 N.J. 131, 140-41 (2004). The “. . . party seeking modification has the burden of showing such ‘changed circumstances’ as would warrant relief from the support or maintenance provisions involved.” Martindell v. Martindell, 21 N.J. 341, 353 (1956). There is no ” . . . bright line rule by which to measure when a changed circumstance has endured long enough to warrant a modification of a support obligation, instead, such matters turn on the discretionary determinations of Family Part judges, based upon their experience.” Donnelly v. Donnelly, 405 N.J. Super. 117, 128 (App. Div. 2009); Larbig v. Larbig, 384 N.J. Super. 17, 23 (App. Div. 2006). Retirement may constitute a change in circumstances warranting a modification or elimination of alimony. Silvan v.Sylvan, 267 N.J. Super. 578, 581 (App. Div. 1993); Deegan v. Deegan, 254 N.J. Super. 350, 358-59 (App. Div. 1992). The analysis turns to whether or not the retirement was voluntary or involuntary. If the change in involuntary, all that is required of the analysis is the parties’ financial circumstances. If the change was voluntary the court must consider a list of factors such as whether or not the retirement was made in good faith. In this case, the Appellate Division found that the Family Court did not abuse its discretion in finding no changed circumstances and affirmed the decision of the lower court. Being that the laws governing alimony have recently been changed, it is very important that you seek out the advice of an attorney to protect your rights an entitlements. If you think that it may be beneficial for you to petition the court for a post-judgment modification of your alimony obligation or for any other reason it is imperative that you seek out the advice of an experienced attorney before moving forward. For more information about alimony, divorce, post-judgment modification, child support, or other family law matters in New Jersey visit HeatherDarlingLawyer.com. This blog is for informational purposes and in no way is intended to replace the advice of an attorney.