The following article was written by Theodore Sliwinski, Esq. and can be found on New-Jersey-Lawyers.com part 3 of 6

17. What other considerations must a court consider for modifying alimony if there is cohabitation?

In an alimony cohabitation case, the court also must apply a needs-based test as well. In the case of Gayet v. Gayet, 92 N.J. 149 (1983), the New Jersey Supreme Court adopted the following test for reducing alimony if there is cohabitation;

  1. Whether the new companion contributes to the former wife’s support.
  2. Whether the new companion resides in the former wife’s home without contributing anything toward the household expenses.

Basically, a court will make an assessment if the former wife still needs the alimony support to survive. Many former husbands become obsessed when their former spouse resides with another man. Many former husbands mistakenly believe that they have hit the jackpot when their former wife moves in with another man. In many cases, they are sorely disappointed when their alimony reduction case is summarily dismissed. The family courts do not want to impoverish women.

In my experience, most judges will only reduce alimony based on cohabitation. Most judges will not permanently terminate alimony based on cohabitation. Relationships are always fluid. It would unreasonable to permanently terminate an alimony award based on a former wife’s new relationship a companion. As we all are aware, people break up all of the time. A court does not want to terminate alimony when there is a real possibility that the former wife could break up with her companion in the foreseeable future.

18. If a spouse retires does this constitute a “change of circumstances” to justify a termination of alimony?

If a husband/payor has a good faith retirement at the age of 65 then this event may constitute a “change of circumstances” to justify a modification of alimony. The court will also consider several other factors such as; the age of the parties; how the pensions and retirement assets were divided during the marriage; whether the retirement was reasonable; and was the retirement motivated to reduce alimony. Our New Jersey courts have held that when a person retires at the age of 65, he is entitled to a plenary hearing to reduce alimony based on a “change of circumstances.”

If a payor spouse retires before the age of 65, then he is subject to a more stringent standard to have alimony terminated. The court will then balance the benefits to the payor spouse against the disadvantage to the payee spouse. Only if the advantage to the retiring spouse substantially outweighs the disadvantage to the payee spouse will the court view the retirement as a legitimate change of circumstances which would justify a modification of alimony.

Some other factors that a court considers when it rules on a Lepis application to terminate alimony on the grounds of retirement are: the age and health of the party; his or her motives in retiring; his or her ability to pay support; and the ability of the other spouse to provide for herself.

19. I have just retired and my income has been cut in half. Can I now make an application to reduce my alimony obligations?

The retirement of the payor/husband may be sufficient grounds to constitute a change in circumstances to reduce or terminate alimony. However, it must be emphasized that retirement alone is not an automatic grounds to terminate alimony. The key issue is whether the payor/husband is retiring voluntarily or mandatorily, and whether his retirement is being taken at the ordinary retirement age, at an eligible early retirement age, or at some other time for some reason. Some basic questions, once answered, will shed some light on the voluntariness of the retirement.

20. What is the key case that analyzes whether a husband’s retirement constitutes a “change in circumstances?”

The key case that analyzes whether a husband’s retirement constitutes a “change in circumstances” is Deegan v. Deegan, 254 N.J. Super. 350 (App. Div. 1992). In the Deegan case, the husband elected early retirement, and he sought to modify his alimony obligations based on a change of circumstances. The court held that in determining whether to modify alimony based upon retirement as a changed circumstance under Lepis, the pivotal issue was whether the advantage to the retiring spouse substantially outweighed the disadvantage to the recipient spouse. The court concluded that only if the answer was in the affirmative should the retirement be viewed as a legitimate change of circumstances to justify a reduction of alimony.

In any alimony reduction case based on a retirement, the court must assess whether the husband’s retirement was in good faith and otherwise reasonable. The court will also have to assess whether under all of the circumstances it was reasonable for the supporting spouse to retire. The court considers the age, health of the party, the motives in retiring, the timing of the retirement, his ability to pay maintenance even after retirement, and the ability of the other spouse to provide for herself.

21. What is the legal test that the court uses to assess whether an early retirement constitutes a “change of circumstances” to reduce alimony?

Another key case is Dilger v. Dilger, 242 N.J. 380 (Ch. Div. 1990). In the Dilger case, a former husband, who had a pre-existing alimony obligation to his former wife of 30 years, voluntarily retired at the age of 62 ½ years. The husband sought to reduce his alimony based on this changed circumstance. The court found that the former spouse’s voluntary retirement at the age of 62½ was not made in good faith, and it was unreasonable under all of the circumstances presented. The court noted that a reasonable retirement age would, in most cases, be 65.

In denying his application the court considered the following criteria:

  1. Whether the retirement was made in good faith.
  2. Whether, in light of all of the surrounding circumstances, it was reasonable for the supporting former spouse to elect an early retirement.
  3. What were the reasonable expectations of the parties at the time of the agreement.
  4. Whether the supporting spouse was planning retirement at a particular age.
  5. What opportunity was given to the depended spouse to prepare to live on the reduced support.

22. Can my deteriorating health condition constitute sufficient grounds to justify a termination of alimony?

The most common grounds that men use to support a motion to reduce/terminate alimony is a major illness or deteriorating health. The key issue in any alimony case based on illness is the severity of the illness, and it’s impact on the payor/husband’s ability to earn an income.

In most cases, if the payor/husband has filed sufficient moving papers, then most family courts will grant him a Lepis plenary hearing. These hearings can be extremely expensive to litigate because the applicant will have to produce a doctor(s) to verify his medical condition or illness to the court. Please keep in mind that medical records are hearsay. A lawyer can’t introduce the medical records unless they are substantiated by a medical professional. An applicant has two options that he can choose to pursue in a Lepis case based on the grounds of illness or a medical condition. The applicant can retain one doctor to review all of the medical records. Thereafter, this doctor can prepare an expert’s report, and testify at court. Alternatively, the applicant can subpoena their treating physician, and compel their appearance at the Lepis plenary hearing. Unfortunately, the later option has its drawbacks. Doctors like to be paid. Moreover, they also don’t like to spend their days in court. The doctor may become so upset by being subpoenaed that he/she may drop the applicant as a patient.

In summary, in any Lepis case that centers around a “change in circumstances” based on an illness or medical condition, then medical professionals must be brought in to testify. The doctor will have to prepare an expert’s report, and also be willing to testify about his/her findings at the Lepis plenary hearing. In my experience most doctors require a $2,500 to $5,000 retainer to prepare a report of this nature, and to appear at trial. Nonetheless, if the alimony obligation is oppressive, then the high retainer fees to the evaluating physician may well be worth. In my experience, it is almost impossible for an applicant to prevail in an alimony reduction case based on an illness or medical condition, unless a qualified medical expert is brought in to testify at the Lepis hearing.

23. I was declared to be disabled by the Social Security Administration. Does this event constitute a “change of circumstances” to warrant a termination of alimony?

If a person is declared disabled by SSA, then this event constitutes a change of circumstances to justify a reduction or termination of alimony. In the case of Golian v. Golian, 344 N.J. Super. 337 (2001), the court held that a declaration by the Social Security Administration (SSA) that the wife was disabled and eligible to receive social security benefits was prima facie proof of a disability. Moreover, the court held that a declaration of eligibility to receive social security also constituted a change of circumstances to enable the application to receive a Lepis hearing.

24. Can a person insert an anti-modification of alimony clause into the property settlement agreement?

In many cases, the parties will insert a clause in the property settlement agreement that would prevent any modification of alimony even if there is a potential chance of circumstances in the future. This type of clause is known as an Anti-Lepis clause. These types of clause have been upheld by the courts. However, the courts will not permit the parties to bargain away the courts equitable powers.

25. Can alimony be extended?

In most cases no. However, some property settlement agreements provide that a spouse may be entitled to alimony after a certain number of years. A dependent spouse will have to file an application for an increase in alimony. The dependent spouse will have to prove a “change of circumstances” to justify an extension of alimony. The courts analyze these applications on a case by case basis. The court will make this determination based on the payor’s ability to pay, both parties’ respective income’s, and the dependent spouses needs. Additionally, rehabilitative alimony can be extended beyond the expiration date as specified in the property settlement agreement. The standard once again is whether there has been a “change of circumstances.”

26. Can my former spouse bankrupt his alimony obligations?

If the payor spouse files for personal bankruptcy under Chapter 7 of the United States Bankruptcy Code, then any alimony, maintenance, or support obligations that are paid to a former spouse under a separation agreement or a divorce decree is not dischargeable. In short, a husband can’t wipe off an alimony obligation in a bankruptcy case.

27. I am a lawyer and my business is going down the tube. What are my chances to prevail if I file a motion to reduce my alimony?

Every case stands on its own merits. A recent case is Donnelly v. Donnelly, A-2389-07. The main point of the Donnelly case is that the court offered a simple warning: Don’t take on a lifestyle you can’t pay for and then try to make your former spouse feel the pinch.

Here, Gregory Donnelly, of Wayne, N.J.’s Donnelly and Warner, had a law pracice that focused on commercial and residential real estate, personal injury and matrimonial work. During his 2003 divorce, his annual income was estimated at $185,000 based that was averaged on a five year basis five years. The parties eventually settled. The PSA required him to pay $1,000 a week in alimony to his wife Elizabeth and $350 a week in child support for their three children.

In 2005, Mr. Donnelly applied to Superior Court Judge before the well respected Michael Diamond in Passaic County for a reduction in payments. He argued that that his income was reduced to $80,000 a year. His income had in fact been falling before the divorce, from $301,705 in 1978 to $130,000 in 2002. He alleged that the reason for the reduction of income was  the decline on increased competition, rising overhead, and a decrease in the firm’s personal injury and real estate practices.

At the motion Mr. Donnelly asserted it was “absolutely impossible” to maintain his practice and to pay other living expenses while paying alimony and support at the established levels. The court that Donnelly’s testimony unpersuasive and it denied the request. The court emphasized that his lifestyle didn’t seem to have suffered. He owned a new Lexus worth $58,000, sold property in Pine Lakes to pay down a $90,000 line of credit, and he bought a home in Wayne with a $600,000 mortgage. Moreover, Mr. Donnelly got remarried and spent $15,000 on his wedding and honeymoon. Judge Diamond opined that even though his business income declined he was still living a upper class lifestyle.

A year later, Mr. Donnelly once again applied for a reduction. In this motion he alleged that saying his income for that year would be only $50,000. He said he had sold his interest in the firm’s building for $175,000 in order to improve his personal finances. Judge Diamond once again denied the motion. The court held that Mr.  Donnelly continued to enjoy an upscale lifestyle and to finance it by borrowing.

The case was then appealed. The Appellate Division affirmed. The court noted that Mr. Donnelly “spent $11,354 per month on his shelter, transportation and personal needs, revealing no effort to modify the lifestyle he enjoyed with his new wife and new child despite the alleged deterioration of his law practice.” Basically, the Appellate Division noted that Mr. Donnelly chose to take on greater financial obligations than would be reasonable if his earnings were steadily dwindling.

In summary, the Donnelly case illustrates how difficult it can be to reduce alimony. If you have a reduction of income, then your CIS and your certification must illustrate that your life style has decreased since the original award of alimony was entered. Here, Mr. Donnelly on established one prong, and that was that his income went down. He failed to prove that he was unable to maintain the same standard of living.

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